Oil markets were lifted Thursday by the announcement of a new round of asset purchases from the U.S. Federal Reserve, raising prospects for the country's business sector.
The Federal Open Market Committee, the Fed's policy-making arm, completed two days of meetings on Thursday after a long lead up indicating the possibility of further stimulus.
Upon the conclusion of the meetings, Fed Chairman Ben Bernanke announced a third round of quantitative easing, colloquially known as QE3, that would differ somewhat from the prior iterations. Whereas the previous efforts had listed specific purchase targets, the Fed announced plans to continue purchases until unemployment rates begin to decline and somewhat beyond.
The announcement sent crude oil prices skyward, with Brent crude eventually closing up 0.35 percent to $116.29 per barrel and West Texas Intermediate crude rising 0.56 percent to close $98.86 per barrel. Notably, though, prices are not necessarily expected to rise further.
"The Fed's policy moves will likely push oil prices higher, but you must be mindful that the policy considerations are a reaction to underlying conditions that are not favorable to a robust demand environment for oil, at the same time," John Kilduff, partner at Again Capital LLC, told Reuters.
