Oil Mixed in Wednesday Trade
NEW YORK (DTN) -- New York Mercantile Exchange spot-month oil futures were mixed Wednesday morning ahead of a fresh report from the Energy Information Administration on oil supply, with traders now recalibrating after the American Petroleum Institute's weekly oil data missed expectations.
The NYMEX West Texas Intermediate crude contract moved lower after API reported late Tuesday that U.S. crude oil stocks unexpectedly increased by 519,000 bbl during the week-ended Oct. 20. A survey had estimated a 2.75 million bbl stock draw.
On products, API detailed a more-than-expected 5.8 million bbl gasoline stock draw and an unexpected 5.0 million bbl drawdown for distillates.
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The Energy Information Administration will release its weekly supply statistics at 10:30 AM ET.
The market is also encouraged by bullish comments from Saudi Arabia suggesting the Organization of the Petroleum Exporting Countries will do whatever it takes to end the global oil glut and keep the marker in balance.
Saudi Energy Minister Khalid al-Falih said Tuesday that OPEC's focus remained on reducing global surplus to their five-year average. OPEC and ten non-OPEC producers have cut oil output by 1.8 million bpd since January. The production agreement is currently slated to run to through March 2018, but they are considering extending the supply cuts by nine months to December 2018.
The market will also be keeping an eye on the dollar. The greenback is down now but remains near a two-week high posted early this week as the market expects President Donald Trump to nominate Stanford University economist John Taylor or current central bank governor Jerome Powell as the next chairman of the Federal Reserve.
A report today said Republican senators want Trump to give the job to Taylor. Taylor is seen as someone who is hawkish and could quicken the pace of interest rate increases compared with current Fed Chair Janet Yellen, whose term expires next February and is considered a dove on monetary policy.
NYMEX December WTI crude was 30cts lower at $52.17 bbl, slipping after setting on Tuesday at a six-month high. December Brent crude contract on the Intercontinental Exchange eased 11cts to $58.22 bbl.
Products were little changed, with NYMEX November ULSD futures edging up 0.14cts to $1.8235 gallon and November RBOB futures were up 0.71cts at $1.7226 gallon.
George Orwel can be reached at george.orwel@dtn.com
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