Oil up following Federal Reserve chair's comments on likelihood of rate hikes

By Duygu Alhan

Oil prices increased in early trade on Friday due to comments made by the US Federal Reserve (Fed) Chair on more interest rate hikes and on Israel's ongoing attacks on Gaza, fueling supply fears.

International benchmark crude Brent traded at $80.38 per barrel at 11.02 a.m. local time (0802 GMT), a 0.46% rise from the closing price of $80.01 a barrel in the previous trading session on Thursday.

The American benchmark West Texas Intermediate (WTI) traded at the same time at $76.05 per barrel, up 0.41% from Thursday's close of $75.74 per barrel.

Oil prices boosted after Fed Chair Jerome Powell left the door open for more interest rate hikes to bring down inflation on Thursday.

"We know that the ongoing progress toward our 2 percent goal is not assured. Inflation has given us a few head fakes," he said at a policy panel at the 24th Jacques Polak Annual Research Conference, hosted by the International Monetary Fund in Washington, D.C.

"If it becomes appropriate to tighten policy further, we will not hesitate to do so," he said.

The American economy expanded 4.9% in the third quarter, beating estimates of 4.3%, according to the Commerce Department's first and advanced readings, putting upward pressure on oil prices.

Meanwhile, the Israeli-Palestinian conflict's intensification continues to drive up supply risks and oil prices.

Israeli warplanes carried out several overnight raids on Gaza hospitals on Thursday, including Al-Shifa, the main hospital in the besieged enclave.

At least six Palestinians were killed and numerous others were injured in a severe bombardment that occurred right outside Al-Shifa Hospital, the official Palestinian news agency Wafa said.

However, weakening China's Price Index, which fell 2.7% yearly and 0.2% monthly in October, and the rise in US crude oil stockpiles by an estimated 11.9 million barrels limited price upswings.