Oil Mixed in Wednesday Morning Trade
Oil futures moved mixed early Wednesday ahead of weekly supply data, with West Texas Intermediate crude sliding to a nearly three-week low overnight despite data released late Tuesday from API showing an unexpected crude stock draw of 1.0 million barrel, and has since reversed higher.
NEW YORK (DTN) -- New York Mercantile Exchange oil futures moved mixed early Wednesday ahead of weekly supply data, with West Texas Intermediate crude sliding to a nearly three-week low overnight despite data released late Tuesday from the American Petroleum Institute (API) showing an unexpected crude stock draw of 1.0 million barrel (bbl), and has since reversed higher, with sentiment still shaky after Monday's stock market rout.
NYMEX ULSD futures fell early Wednesday while RBOB futures edged higher after the API detailed a less-than-expected 227,000 bbl stock draw for gasoline and an unexpected stock build of 4.55 million bbl for distillates. A survey indicated estimated draws of 1.5 million bbl for gasoline and 2.75 million bbl for distillates.
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The Energy Information Administration (EIA) will release its weekly oil report at 10:30 a.m. ET.
Oil futures declined Tuesday after EIA released their Short-term Energy Outlook that revised higher expected oil supply from oil-producing countries that are not part of the Organization of the Petroleum Exporting Countries by 300,000 barrels per day (bpd) this year. EIA projects non-OPEC supply would grow at the rate of 2.35 million bpd to 61.04 million bpd in 2018, revised up 350,000 bpd versus January's outlook, mostly due to rising output in the United States.
U.S. crude oil production outlook was revised 300,000 bpd higher from January to 10.6 million bpd this year, up 1.3 million bpd versus 2017. If achieved, 2018 production would be the highest annual average on record, said EIA.
On Wall Street, equities are set to open slightly higher, building on Tuesday's rally after Monday's plunge amid concerns about inflation. The domestic stock market remains volatile.
In currency trade, the U.S. dollar firmed, trading near Tuesday's two-week high versus a basket of six major currencies, with a stronger dollar bearish for oil futures. The U.S. currency recently fell to a three-year low.
In early trade, NYMEX March WTI crude futures were up 25 cents at $63.64 bbl, reversing from a $62.86 nearly three-week spot low. April Brent crude on the Intercontinental Exchange was up 55 cents near $67.40 bbl after inside trade. NYMEX March ULSD futures eased 0.58 cents to $1.9790 gallon, paring a decline to a fresh six-week low on the spot continuation chart of $1.9719. March RBOB futures gained 1 cent to $1.8152 gallon after inside trade.
George Orwel can be reached at george.orwel@dtn.com
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