NYMEX crude recovers slightly after Fed rate cut

22 January 2008 15:37  [Source: ICIS news]

LONDON (ICIS news)--NYMEX light sweet crude futures recovered some of the losses posted on Monday and earlier on Tuesday after the US Federal Reserve cut interest rates by three quarters of a percentage point in a bid to restore confidence in the US economy.


However, the emergency rate cut seemed to have little effect in reversing the overall downward trend in crude oil prices.


By 14:30 GMT, February NYMEX crude was trading around $88.04/bbl, down $2.52/bbl from the Friday close of $90.57/bbl but up on earlier figures on Tuesday. 


Due to the holidays in the US on Monday, the NYMEX prices did not publish a settlement figure.


At the same time, March Brent crude on ICE Futures was trading around $86.84/bbl, down $0.67/bbl from the Monday close.


The US stock markets opened on a negative note, unimpressed by what is now widely viewed as a panic move from the Fed. 


The oil markets have been fallen in tandem with global markets over fears that a US recession could spill over globally.


Investment banking sources were expecting the Fed to cut interest rates in their official meeting next week by a further half a percentage point, followed by another half point cut at the end of March.


Tony Dillon contributed to this article


By: Giovanni Coiro
+44 20 8652 3214

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