Fed's Interest Rate Cut Seen as Supportive for Oil Markets, Rystad Energy Says

06:05 AM EDT, 10/30/2025 (MT Newswires) -- For energy markets, the Federal Reserve Bank's lowering of its benchmark interest rate is expected to provide support to oil prices, Rystad Energy said in a Wednesday note.

The Fed lowered its interest rate by 25 basis points to the 3.75-4.00% range, largely in line with expectations, as the latest U.S. inflation reading came in below expectations, Rystad Energy noted.

"By easing through a data fog, the Federal Reserve is acknowledging softer labor momentum, while stopping short of declaring victory over inflation," said Claudio Galimberti, chief economist and global market analysis director at Rystad Energy.

With the rate cut, the Fed appears to be aiming at stabilizing financial conditions after months of growing funding stress, Galimberti said.

Energy markets interpreted the policy shift as supportive for short- and medium-term demand and global growth sentiment, according to Rystad Energy.

"The Fed's decision underscores a broader turn in its policy cycle - one that favors gradual reflation and support over restraint, providing a tailwind to commodities sensitive to economic activity," Galimberti said.

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