DTN Oil Update
Oil Futures Hold Steady Despite Low Crude Inventories
HOUSTON (DTN) -- Oil prices were little changed to end the week on Friday but were on track for their first weekly gain in three weeks, and the largest since early July. A larger-than-expected draw in U.S. crude oil inventories, along with fading hopes for a quick Russia-Ukraine ceasefire, were the main drivers supporting prices this week.
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The front-month NYMEX futures contract edged up by $0.27 to $63.79 bbl, and ICE Brent for October delivery rose $0.14 to $67.81 bbl.
September RBOB gasoline futures increased by $0.0014 to $2.1611 per gallon, while the front-month ULSD contract fell by $0.0140 to $2.311 per gallon.
The U.S. Dollar Index dropped by 0.936 points to 97.575.
On Wednesday, the Energy Information Administration reported a 6 million bbl draw in domestic crude oil inventories in the week ended August 15. A large 2.7 million bbl draw to U.S. gasoline stocks helped to cement this picture. Additionally, the recent acceleration in OPEC+ production increases has contributed to putting pressure on global oil prices as well.
Market participants are now less confident about a quick resolution to the war in Ukraine, reducing bearish pressure. U.S. President Donald Trump has emphasized the importance of a ceasefire, leading separate talks with Russian President Vladimir Putin, Ukrainian President Volodymyr Zelenskyy, and leaders from the European Union. Trump aims to convene a trilateral summit between the U.S., Russia and Ukraine. However, the Kremlin has not confirmed participation in such an event.
This morning, Federal Reserve Chairman Jerome Powell signaled a potential interest rate cut in the short term. "The effects of tariffs on consumer prices are now clearly visible. We expect those effects to accumulate over coming months, with high uncertainty about timing and amounts," Powell said during an economic symposium at Jackson Hole.
