Oil steady after US Fed’s final rate cut in 2025

Brent crude’s price has remained largely steady after the US Federal Reserve (Fed) cut interest rates at its final policy meeting of the year.

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In another widely expected move, the US Federal Open Market Committee (FOMC) cut its key interest rate by 25 basis points, to a range of 3.50% to 3.75%.

“The Fed delivered an expected 25bp [25 basis points interest rate] cut,” remarked ANZ Bank’s senior commodity strategist Daniel Hynes.

Lower interest rates in the US can boost demand growth by making dollar-denominated commodities like oil more affordable for holders of other currencies.

This marks the third and final interest rate cut made by the central bank in 2025, following a 25-bp cut in September and October.

Although the Fed committee has warned that “uncertainty about the economic outlook remains elevated,” it reiterated its commitment to achieving a 2% inflation rate over the longer run.

Market participants are now looking for clues from the Fed's monetary policy outlook for 2026, Hynes said.

By Aparupa Mazumder

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