DTN Oil Update
Oil Ends Off Lows as Muted US Inflation Signals Fed Hold
SECAUCUS, N.J. (DTN) -- Crude oil futures clawed back a portion of their steep morning losses Tuesday as a cooler-than-expected U.S. inflation reading signaled the Federal Reserve would keep interest rates steady for December.
NYMEX WTI crude for December delivery fell $0.81 to settle at $86.04 bbl, recovering over $2 from its earlier six-week low of $83.88.
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ICE Brent for January delivery settled down $1.08 at $91.49 bbl, off from the day's bottom of $89.16.
Downstream, NYMEX ULSD for December delivery dropped $0.0839 to settle at $4.1309/gallon, well above its intraday low of $3.9947/gallon. RBOB futures for December fell $0.0421 to $2.6088/gallon after dipping to $2.5720/gallon earlier in the session.
The U.S. Dollar Index strengthened 0.590 points to 102.125 against a basket of foreign currencies.
The selling pressure in energy futures stalled after the moderate 0.4% month-on-month growth in the U.S. Consumer Price Index for October reinforced expectations that the Fed will maintain interest rates in their current range of 3.75-4.00%.
Earlier, crude futures were pressured by U.S. President Trump's remarks that further military action against Iran was "not very necessary." Qatari mediators also reported progress in exploratory peace talks between the two sides.
Energy market participants are, meanwhile, awaiting the American Petroleum Institute's (API) weekly inventory report at 4:30 p.m. EST to glean direction for crude and refined product futures. The API data follows last week's substantial 5.27 million bbl commercial crude draw, with traders focused on whether domestic stockpiles extended that draw while monitoring inventory builds in Cushing, Oklahoma, and regional distillate shifts across the Midwest.
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