WASHINGTON (DTN) -- Crude and refined products futures on the New York Mercantile Exchange and the Brent contract on the Intercontinental Exchange edged higher in early trade Wednesday, helped by a sagging U.S. dollar and rising equities as investors look towards progress on a last-minute stimulus package in Washington and pending approval from Food and Drug Administration for the Pfizer/BioNTech coronavirus vaccine.
Capping gains for the complex, inventory data released by American Petroleum Institute on Tuesday showed domestic crude and refined product supplies increased by a combined 9.89 million barrels (bbl) during the week-ended Dec. 4. Gasoline stockpiles rose by a much higher than expected 6.442 million bbl from the previous week, while distillate fuel supplies gained 2.316 million bbl, more than four times expectations. Commercial crude oil inventories increased 1.141 million bbl, contrasting sharply with consensus for a 1.2 million bbl decline.
U.S. Energy Information Administration will release official inventory data for the reviewed week at 10:30 a.m. ET.
Oil and equity investors are focused on emerging signs of a breakthrough in on-and-off again stimulus talks from Washington lawmakers as millions of Americans are set to lose their unemployment benefits and face eviction. White House on Tuesday came back to the negotiating table with an offer of a $916 billion package from Treasury Secretary Steven Mnuchin, which secured backing by Senate Majority Leader Mitch McConnell. McConnell, reports indicate, also eased on his demand for liability protection for business and government regarding coronavirus related claims.
"What I recommend is we set aside liability and set aside state and local, and pass those things that we can agree on knowing full well we'll be back at this after the 1st of the year," McConnell told reporters on Tuesday.
Separately, FDA is set to approve this week the coronavirus vaccine developed by Pfizer and BioNTech after its review found no concerns that would prevent granting Emergency Use Authorization in the United States. Earlier this month, United Kingdom approved the vaccine and on Tuesday vaccinated the first person against the novel coronavirus disease.
Even as the latest news was encouraging, German Chancellor Angela Merkel cautioned this week that the European Union is unlikely to administer enough vaccinations in the first quarter 2021 to bring about a major change in the pandemic -- an unusually realistic take from a politician on how a vaccine rollout would take place. She added however the vaccine would reduce the number of deaths in the early months of next year and that alone would be a big win.
Germany has extended its partial lockdown until the mid-January and California -- the most populous state in the United States, announced renewed quarantine restrictions to ease stress on local hospital capacity. Some 85% of California's 40 million residents now live under some form of quarantine restriction
In early trade, January West Texas Intermediate edged higher to near $46 bbl and ICE February Brent futures was treading near $49 bbl. NYMEX January ULSD futures was little changed near $1.4070 gallon, while the January RBOB contract moved up 0.55 cents to $1.2614 gallon.
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