By Barani Krishnan

Investing.com — The bulls in oil are waiting for that next meaningful event for crude’s upside, after last week’s OPEC+ output cut announcement. As of now, there’s no sign there’ll be one that’s big enough, leaving the market to tread water, barring any surprises.

New York-traded West Texas Intermediate, or , settled down 96 cents, or 1.2%, at $79.74 per barrel.

London-traded settled down 94 cents, or 1.1%, at $84.18.

Since surging more than 6% to a WTI peak of $81.81 and Brent high of $86.44 in the heat of the OPEC+ announcement, the past five sessions have done bunk for oil’s upside, with the two crude benchmarks being unable to push beyond on talk of the output cut alone. 

That leaves longs in crude somewhat exposed to the vagaries of the and U.S. as the broader markets get into a guessing game on the Federal Reserve’s and when the central bank might actually pause on a hike.

With the Fed watch, inflation expectations due Wednesday from the Consumer Price Price Index, or CPI, reading for March are on the higher side, though somewhat benign. Economists have forecast core consumer price inflation, which excludes food and fuel costs, to rise on a month-over-month basis, for an annual increase of , up from 5.5% in February.

The CPI reading will come after Friday’s , or NFP, report that showed an addition of 236,000 jobs last month, just shy of the 239,000 called by Wall Street’s forecasters. The number was also well above the 200,000 that would have been instrumental in getting the Fed to pause in May. Annual wage gains also slowed but remained too high to be consistent with the central bank’s 2% inflation target.

The Fed itself has minutes of its March 22 rate decision — where it added another quarter point to rates — due for release on Wednesday. While that could shed some light on how the central bank might proceed going forth, the general consensus as of now is that it isn’t done yet with hikes. 

The NFP and forecast CPI, combined, are suggesting at the least that the Fed has another 25 basis point hike coming in May that would effectively raise rates to a peak of 5.25%. So far, Wall Street expectations for a Fed rate cut — not just pause — by the year end appear to have little currency.

For macro-related assets, including oil and , that could mean more headwinds.

“There have been a lot of headlines but nothing is moving oil today,” said Ed Moya, analyst at online trading platform OANDA. “This week, we will find out if the U.S. economy is taking the steps into the recession pool or if it is going to do a cannonball into it. Wall Street should have a strong handle on the trajectory of the economy after it gets a pivotal inflation report.”

Notwithstanding the Fed watch, oil will likely benefit from another potentially strong U.S. weekly inventory report on Wednesday.

in storage fell by 3.739 million barrels during the week ended March 31, the U.S. Energy Information Information, or EIA, said in its latest Weekly Petroleum Status Report. In the previous week to March 24, crude stockpiles tumbled by 7.489M barrels.

There were substantial draws in and stockpiles too.

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