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U.S. oil futures remain lower after supply data, Fed ahead

Published 09/17/2014, 10:37 AM
Updated 09/17/2014, 10:37 AM
U.S. oil futures decline after supply report, Fed statement ahead

Investing.com - West Texas Intermediate oil futures remained lower on Wednesday, after data showed that oil supplies in the U.S. rose unexpectedly last week, while gasoline stockpiles fell more than forecast.

On the New York Mercantile Exchange, crude oil for delivery in November lost 69 cents, or 0.73%, to trade at $93.13 a barrel during U.S. morning hours.

Prices were at $93.27 a barrel prior to the storage report. Futures were likely to find support at $91.52 a barrel, the low from September 16 and resistance at $94.99, the high from September 5.

A day earlier, U.S. oil prices rallied $1.82, or 1.98%, to end at a two-week peak of $93.81 a barrel.

The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories increased by 3.7 million barrels in the week ended September 12, compared to expectations for a decline of 1.7 million barrels.

Total U.S. crude oil inventories stood at 362.3 million barrels as of last week.

The report also showed that total motor gasoline inventories decreased by 1.6 million barrels, compared to forecasts for a decline of 0.3 million barrels, while distillate stockpiles rose by 0.3 million barrels.

Meanwhile, market players prepared for the outcome of the Federal Reserve’s policy meeting later in the day, amid speculation the U.S. central bank could adopt more hawkish language.

The Fed was expected to cut its asset purchase program by another $10 billion, which would keep it on track for winding up the program in October, and to start raising interest rates sometime in mid-2015.

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Investors will also pay close attention to a press conference with Fed Chair Janet Yellen shortly after the decision for further clues on the timing of the first U.S. rate hike since 2006.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for November delivery declined 29 cents, or 0.3%, to trade at $98.76 a barrel during the U.S. morning session.

London-traded Brent prices jumped more than $1 on Tuesday to settle at $99.05 amid reports that the Organization of the Petroleum Exporting Countries could trim its 2015 output target by 500,000 barrels per day in light of weakening global demand.

OPEC Secretary General Abdallah El-Badri said Tuesday that the organization could reduce production to 29.5 million barrels per day from 30 million when the group meets in November.

Oil prices have slid in recent weeks on concerns that global supply remains ample while demand remains weak.

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