With the Federal Open Market Committee decision on U.S. monetary policy looming, even commodity traders are getting a bit edgy. Weighing strengthening demand, today's FOMC decision, and tomorrow's report on U.S. petroleum supplies, traders have bid up the October crude futures contract to yet another all-time high. At last check, the contract was 73 cents higher at $81.30 per barrel, down from an intraday record of $81.50.
Looking ahead to tomorrow's report, expectations for crude supplies are calling for a ninth-weekly rise in distillate inventories and a seventh-weekly decline in motor gasoline supplies. Analysts are looking for a gain in crude supplies of about 2 million barrels, according to Alaron Trading. But MF Global predicts a decline of 2.7 million, and a survey of analysts, conducted by Platts, calls for a fall of 1.75 million.
But, despite the rise in energy prices, oil service stocks are taking a bit of a beating today. At last check, the Philadelphia Oil Service Index (OSX) was off more than 0.5% as Wachovia downgraded a couple oil service companies. Specifically, FMC Technologies dropped more than 3% after being cut to underperform from market perform, while Cameron International was downgraded to market perform from outperform.