Oil drops after hitting two-week highs

Brent oil futures for November dropped 0.5% to $67.62 a barrel

Oil prices dropped in Asian trade on Thursday, losing steam after rising to two-week highs.

Crude prices had steadily advanced this week as continued military action between Russia and Ukraine spurred concerns over disruptions in Russian oil output. Speculation over more sanctions on Russia’s oil industry also buoyed prices.

A weaker dollar, which declined before the U.S central bank’s Wednesday decision, had aided crude’s gains earlier this week. But the dollar firmed on Thursday, pressuring oil.

Brent oil futures for November dropped 0.5% to $67.62 a barrel.

Despite clocking some gains this week, oil prices were still nursing steep losses in 2025, as prices were battered by concerns of slowing demand and a looming supply glut.

The central bank cut interest rates by 25 basis points as expected on Wednesday, and signalled that it will steadily cut rates in the coming months.

The move was largely in line with market expectations, and left traders pricing in a 93% chance that the bank will cut rates by another 25 bps in October, according to CME Fedwatch showed.

But while lower rates tend to boost oil demand, markets also fretted over the bank’s plans to cut rates further, given that it indicated growing concerns over the U.S. economy among policymakers.

A cooling labour market appeared to be the biggest motivator of the bank’s cuts. But sticky U.S. inflation could discourage further easing from the bank, especially if inflationary pressures from higher U.S. trade tariffs become more pronounced.

The dollar firmed after the bank’s decision, recovering from a 3-½ year low hit in the run-up to Wednesday’s move. Some resilience in the dollar also weighed on crude prices.