Oil edges higher on falling US inventories

Oil prices rose slightly on Thursday, supported by falling US crude inventories, though gains were limited after the US Federal Reserve signalled it would slow the pace of interest rate cuts in 2025, a move that could dampen economic growth, reduce fuel demand and strengthen the dollar.

Brent crude futures rose 44 cents, or 0.60% to $73.83 a barrel by 1414 GMT. US West Texas Intermediate (WTI) crude for January delivery gained 68 cents, or 0.96%, to $71.26. The more active WTI contract for February rose 52 cents to $70.54.

"The bottom line for oil is the longer the Fed stays on pause, the stronger the US dollar. This tends to generate headwinds for commodities like oil," said Harry Tchilinguirian at Onyx Capital Group. Official data from the Energy Information Administration on Wednesday showed US crude stocks fell by 934,000 barrels in the week to December 13.