Oil prices slip on view US rate cuts could be delayed

Oil prices retreated from near a 2024 high hit on Wednesday after U.S. data showed oil stocks rose less than expected and fuel inventories fell, in a sign of robust demand.

Still, were bracing for the likelihood that the U.S. Federal Reserve could delay its first interest rate cut to the second half of this year in a boost to the U.S. dollar, according to a Reuters poll of foreign exchange strategists.

A strong greenback dents demand for dollar-denominated oil among buyers using other currencies.

Fed Chair Jerome Powell said on Wednesday continued progress on "is not assured", though the U.S. central bank still expects to reduce its interest rate this year.

Meanwhile, China's import and export growth beat estimates, suggesting global trade is turning a corner in a positive signal for policymakers as they try to shore up economic recovery.

China posted a 5.1% rise in imports in the first two months of 2024 from a year earlier to about 10.74 million barrels per day (bpd), customs data showed on Thursday, as crude purchases ramped up to meet fuel sales during the Lunar New Year holiday.

"China's trade balance data is a positive sign for the oil market's demand outlook," Auckland-based independent analyst Tina Teng said.

However, she added that risk-off sentiment dominated financial markets as stocks are retreating on Wall Street.

Data on Wednesday showed crude inventories rose for a sixth week in a row, building by 1.4 million barrels, about two-thirds of the 2.1 million-barrel rise analysts had forecast in a Reuters poll.

and distillate stocks fell more than expected, the EIA data also showed.

(Additional reporting by Florence Tan in Singapore and Arathy Somasekhar in Houston Editing by Emelia Sithole-Matarise, Jason Neely and Frances Kerry)