Crude oil prices recover by almost 2% following Fed rate cuts

The rise in North Sea Brent crude prices helped lift it from its lowest levels last week.

Oil prices surged nearly 2% on Thursday after the significant interest rate cut by the U.S. Federal Reserve, which helped Brent recover from its lowest levels in almost three years, touched last week.

Brent crude, the light, physical oil from the North Sea in Europe, gained $1.23, or 1.67%, reaching $74.88 per barrel, further distancing itself from the sub-$69 levels reached last week.

Meanwhile, U.S. West Texas Intermediate (WTI) crude rose $1.04, or 1.47%, to $71.95 per barrel.

Mexico’s export blend also advanced 1.87%, rising from $65.61 to $66.84 per barrel, marking its second consecutive week of gains.

Prices have been recovering since Brent dipped below $69 per barrel on September 10, for the first time in nearly three years. Both benchmarks have posted gains in five of the seven sessions since then.

The world’s six largest oil companies saw their value rise in various stock exchanges after the Fed’s announcement. France’s Total Energies led the gains, rising 2.32%, followed by ConocoPhillips with 1.78%.

Next was the UK’s Shell, advancing 1.61% in the stock market, while U.S. giant ExxonMobil gained 1.24%. State-owned Saudi Aramco ended the day up 1.11%, while Chevron in the U.S. posted a slight loss of 0.72%.

Oil prices surged after the U.S. Federal Reserve’s interest rate cut, which helped Brent distance itself from last week’s lows.

On Wednesday, the Fed reduced interest rates by 50 basis points. Lower borrowing costs typically boost economic activity and energy demand, but the market also interpreted the move as a sign of a weakening U.S. labor market, which could slow economic growth.

U.S. crude inventories, in the world’s top producer, fell to a one-year low last week, according to government data released Wednesday.