Crude oil prices rose sharply overnight, smashing through $80.00 per barrel as the commodity continued its ascent from the multi-month December low. A weaker US Dollar provided an additional tailwind for WTI prices after Federal Reserve Chair Jerome Powell affirmed to lawmakers on Capitol Hill that the Fed stands ready to take further action on the sustained inflation seen in the US economy, if necessary.
While Mr. Powell’s commentary was rather hawkish, expectations were already high amid the sustained inflation seen across the US economy. That said, it appears markets believe the Fed is capable of normalizing policy while leaving strong economic growth intact. That paints a picture that is supportive of demand-sensitive commodities like oil.
