Crude oil prices advanced following the report released by the EIA, which showed that inventories climbed higher than expected last week. West Texas Intermediate (WTI) rose , trimming the biggest monthly fall for January since 2010 as market participants focus on the release of the US GDP later in the day.
Meanwhile following the Federal Reserve’s two day policy meeting, fed officials decided to reduce its bond buying program by an additional $10 billion.
WTI crude oil for March delivery added 0.56% higher, trading at $97.91 per barrel on the New York Mercantile Exchange as of 9:59a, GMT. At the same time Brent for March settlement rose 0.35%, standing at $108.23 per barrel on the ICE Futures Europe exchange. The European benchmark crude was at a premium of $10.25 to WTI on the ICE exchange.
US Crude Inventories
Data from the Energy Information Administration (EIA) showed that crude inventories climbed by 6.4 million barrels in the week ended January 24. The figures surpassed analysts forecast of a rise by 2.15 million barrels.
The same data also revealed that the demand for distillates; which includes heating oil, climbed to the highest level in nearly six years. Meanwhile, Cushing crude stockpiles reported a 237,000 rise, compared with the 722,000 rise seen in the previous week.
The American Petroleum Institute (API) report reveled oil inventories added 4.7 million barrels in the week ending January 24, compared to analysts forecast of an additional 2.3 million barrels.
US GDP in Spotlight
Market participants are expecting to see an upbeat gross domestic product (GDP) report which is forecasted to show a 3.2% annualized rise. The upbeat reading is based on approximately 45% of the whole quarter data.
On Wednesday, The Federal Open Market Committee (FOMC) concluded its two-day meeting by deciding to reduce the central bank’s monthly purchases of treasuries and mortgage-backed securities (MBS) by an additional $5 billion each.
“Growth in economic activity picked up in recent quarters,” The statement from the Federal Reserve stated. “Household spending and business fixed investment advanced more quickly in recent months.”
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