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Brent Prices Steady As Budget Deal Is Put To A Vote

ByBenzinga
AuthorBenzinga
Published 12/13/2013, 12:18 AM
Updated 05/14/2017, 06:45 AM

Brent crude oil was steady above $109 on Thursday as investors waited for more clues about the US Federal Reserve's taper timeline. The commodity traded at $109.71 at 8:05 GMT on Thursday morning.

US lawmakers unexpectedly created a bipartisan budget agreement this week, cutting down on worries about another government shutdown in January. The agreement softens the end of year “sequester” cuts by allowing a $63 billion cushion for Federal agencies over the next two years. However the deal also cuts down on national debt by between $20 and $23 billion over the next ten years.

The preliminary agreement will be put to a vote in the House of Representatives as early as this week, which will then be followed by another vote in the Senate. If the deal is accepted by Democrat and Republican policy-makers, it could provide further support for the Fed to begin tapering. If accepted, the new budget agreement would take away much of the political uncertainty that has kept the Fed from cutting back on its stimulus too soon.

Prices were also under pressure from falling crude stockpiles in the US. CNBC reported that the Energy Information Administration released a report showing that US crude inventories fell to 375 million barrels, a 10.6 million barrel drop. The figure was far below the three million barrel draw that analysts expected.

Moving forward, investors will be looking to data from the US for further clues about the Fed's taper plans. Weekly jobless claims data, due out on Thursday at 13:30 GMT, will be closely watched for signs of further recovery in the number one oil consuming nation.

BY Laura Brodbeck

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