By Laura Sanicola
Feb 2 (Reuters) - Oil prices rose in early Asian trade
on Thursday after the U.S. Federal Reserve raised interest rates
by 25 basis points, sending the dollar lower.
Brent crude futures rose 56 cents, or 0.7%, at
$83.40 a barrel while West Texas Intermediate (WTI) U.S. crude futures rose 65 cents, or 0.8%, to $77.05 a barrel.
The Federal Reserve raised its target interest rate by a
quarter of a percentage point on Wednesday, yet continued to
promise "ongoing increases" in borrowing costs as part of its
ongoing battle against inflation.
"Inflation has eased somewhat but remains elevated," the
U.S. central bank said in a statement that marked an explicit
acknowledgement of the progress made in lowering the pace of
price increases from the 40-year highs hit last year.
A weaker greenback makes U.S. dollar-priced oil less
expensive for holders of other currencies, boosting demand.
The U.S. dollar last fell 0.3% in the session against a
basket of currencies , at 101.15. Prices are also rising in the backdrop of a Feb 5. ban on
Russian refined products by the European Union.
EU countries will seek a deal on Friday on a European
Commission proposal to set price caps on Russian oil products,
after postponing a decision on Wednesday amid divisions between
member states, diplomats said.
The European Commission proposed last week that from Feb. 5
the EU apply a price cap of $100 per barrel on premium Russian
oil products such as diesel and a $45 cap per barrel on
discounted products such as fuel oil.
(Reporting by Laura Sanicola; Editing by Leslie Adler)
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