Oil rises after low inventories

Oil prices have bounced today, with Brent crude pushing back through $108 per barrel.

Lower-than-expected US oil inventories, together with the expectation that the Federal Reserve will forecast a more positive outlook for the economy this evening (London time), is helping to underpin prices.

As it stands, there is significant resistance around the $109/bbl level with $107.50 acting as a barrier to downside moves. The decline from the 28 August highs of $117 amounts to a 8% drop overall.

Any forecast from the Fed that GDP growth in the US is to improve further could solidify a move higher.

Daily Brent Crude chart

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