DTN Oil Update

Oil Futures Fell Due to High Crude, Gasoline Stocks

HOUSTON (DTN) -- The front-month NYMEX WTI futures contract and the ICE Brent futures contract for March delivery dropped on Wednesday following American Petroleum Institute data showing a build in U.S. crude and gasoline inventories last week.

The American Petroleum Institute reported Tuesday, Jan. 28, that commercial crude oil supply increased 2.86 million bbl in the week ended Jan. 14.

Crude oil stocks at the Cushing, Oklahoma tank farm, the delivery point for NYMEX WTI futures, declined 144,000 bbl, the API data showed.

Meanwhile, gasoline inventory rose 1.89 million bbl and distillate fuel supply dropped 3.75 million bbl in the reference week.

Wednesday, the market will focus on the first meeting of the Federal Reserve this year, which started Tuesday, Jan. 28. The Fed, consisting of 12 regional banks and a board of seven governors, is expected to maintain steady the federal funds rate, as inflation has not shown significant movements since its Federal Open Market Committee's December meeting.

However, concerns persist about the effect that upcoming trade tariffs that the President Donald Trump's administration are expected to impose on China, Mexico, Canada and other countries, could have on consumer prices.

White House Press Secretary Karoline Leavitt confirmed on Tuesday, in a press conference, that trade tariffs on imported goods from Canada and Mexico planned by the Trump administration will take effect by Feb. 1.

The NYMEX WTI futures contract for March delivery dropped by $0.56 to $73.21 bbl, while the front-month ICE Brent futures contract fell by $0.54 to $76.95 bbl. Downstream, February RBOB futures contract edged down by $0.0157 to $2.0369 gallon and the ULSD futures contract for February delivery fell by $0.0201 to $2.4300 gallon.

The U.S. Dollar Index rose by 0.33% to 108.01 against a basket of foreign currencies.

Maria Eugenia Garcia can be reached at Maria.Garcia@dtn.com