Investing.com - Oil futures traded modestly higher in the early part of Thursday’s Asian session, though near-term gains may be limited as traders attempt to forecast the Federal Reserve’s next move regarding its quantitative efforts.
On the New York Mercantile Exchange, light, sweet crude futures for September delivery rose 0.30% to USD107.17 per barrel in Asian trading Thursday. The September contract inched up 0.02% to USD106.85 per barrel Wednesday.
In U.S. economic news out Wednesday, the Labor Department said producer prices were flat last month, indicating little in the way of inflationary pressures in the world’s largest economy. Core prices increased 0.1% last month, below the 0.2% increase analysts expected. Year-over-year, the produce price index was up 1.2%.
A weak producer price index suggest inflationary pressures remain soft and an economy still in need of monetary support.
The numbers dampened expectations that U.S. recovery is strong enough for the Federal Reserve to begin tapering its USD85 billion-a-month asset-purchasing program, which has supported gold since its inception.
Also on Wednesday, the U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories fell by 2.8 million barrels in the week ended August 9, surpassing expectations for a decline of 1.5 million barrels.
Total U.S. crude oil inventories stood at 360.5 million barrels as of last week. The report also showed that total motor gasoline inventories decreased by 1.2 million barrels, beating expectations for a decline of 822,000 barrels.
The EIA added that the U.S. is not increasing its consumption of liquid fuels and that China is poised to pass the U.S. as the world’s largest oil importer. The U.S. and China are the world’s two largest oi l consumers.
Elsewhere, Brent for October deliver rose 0.22% to USD109.18 per barrel on the ICE Futures Exchange.