LONDON, July 13 Reuters Global oil benchmark Brent hovered above 80 a barrel on Thursday after U.S. inflation data implied interest rates in the world39;s biggest economy are close to their peak.

Data released on Wednesday showed U.S. consumer prices rose modestly in June and registered their smallest annual increase in more than two years as inflation continued to subside.

Markets expect one more interest rate rise before the U.S. ratehiking cycle peaks. Higher rates can slow economic growth and reduce oil demand.

Oil prices have rallied by around 12 in two weeks, primarily in response to supply cuts from top producers Saudi Arabia and Russia, said Craig Erlam, senior market analyst at OANDA.

Some profittaking at these levels wouldn39;t be hugely surprising and may have come sooner if not for the U.S. consumer price inflation data, he said.

Brent crude futures dipped 1 cent to 80.10 per barrel by 1315 GMT, while U.S. West Texas Intermediate crude futures crept 8 cents lower to 75.67.

The futures contract structure of the global benchmark Brent indicates the market is tightening and that OPEC could be succeeding in its mission to support the market.

The premium of a frontmonth Brent contract to a sixmonth February 2024 contract rose to 2.64 a barrel on Wednesday. At the end of the June, the frontmonth contract was at a discount to the sixmonth contract.

In the latest insights on the supplydemand balance, a report by the International Energy Agency IEA on…