|News||Mixed oil prices after the confidence vote and API report|
|Previous||-3.4 Million Barrels|
|Forecast||-1.8 Million Barrels|
|Analysis||Oil was mixed in Asian trading on Wednesday after the government in Greece won a key confidence vote late Tuesday, which paved the way for the country to work its way for additional austerity measures and receive additional financial aid, aimed at gaining approval from EU finance ministers and the IMF for the next tranche of aid from the 110 billion euro bailout package approved last year.|
Light sweet crude oil for August opened today at $93.67 recording the highest at $93.95 and the lowest at $93.30 and is currently trading around $93.72.
American Petroleum Institute said late Tuesday that US crude oil supplies fell by 81,000 barrels last week, while oil product stocks fell more sharply and lower than expected, and gasoline inventories declined by 1.5 million barrels and distillate inventories shed 541,000 barrels. The report increased the odds for a drop in stockpiles to be reported later today by the closely watched EIA report.
The EIA is expected to report today a drawback in crude stockpiles by 1.8 million barrels following last week’s decline of 3.4 million barrels which is expected to help crude resume the upside move as the pessimism gradually unwinds from the market.
The dollar strengthened during Asian session today, which tends to discourage investment in dollar-priced commodities such as oil. USDIX opened today at 74.55 recording the intraday high at 74.83 and the low of 74.51 and is currently trading around 74.57.
The market is also waiting the conclusion of a two-day meeting of the Federal Open Market Committee (FOMC), as they’re meeting amid signs of weakness in the world’s biggest economy and biggest oil consuming nation. Investors are looking for clues for the next step by policy markets and their outlook for the recovery as downbeat comments from Bernanke on growth today will be very bearish on oil, as steady rates are taken for granted from the Federal Reserve.
Brent crude rose on Wednesday after three days of continuous losses, as Greece government has survived a confidence vote, Brent crude for august increased 25 cents to reach $111.20 a barrel.