NewsEIA report
Previous0.950 million barrels
Forecast1.35 million barrels
AnalysisCrude oil is trading within a narrow range today after rebounding following the U.S. Federal Reserve’s decision to maintain its near-zero interest rates for two more years the thing that weighed on the dollar and helped reverse a sharp fall in oil. Alos, late data yesterday from the American Petroleum Institute showed that oil supplies fell last week and investors are waiting for the Energy Information Administration report which will be released later today which might hold crude's gains for today. 

Light sweet crude oil for September opened today at $81.87 a barrel recording the intraday high at $82.44 a barrel and a low of $80.71 a barrel and is currently trading around $82.29 a barrel.

The dollar index which measure’s the green currency performance against other six major currencies opened today at 73.89 recording the highest at 74.60 and the lowest at 73.84 and is currently trading around 73.98.

The Federal Open Market Committee decided to keep its benchmark interest rate unchanged and low between 0.0% and 0.25% which will be held at exceptionally low level through at least mid-2013 due to the current weaker than expected growth, pointing out and confirming that the world's leading economy growth was significantly slower this year.

This decision was already highly expected since that the Feds along with other governmental and non-governmental organizations and institutions still strongly believe that low rates will support the economy amid the present weak economic conditions and support growth, although the current recovery is still taking place at a sluggish pace.

The American Petroleum Institute, in a report late on Tuesday, said U.S. domestic crude stocks declined 5.21 million barrels to 348.6 million last week, while gasoline inventories decreased 1.01 million barrels to 211.2 million barrels.

An Energy Department report today may show that U.S. crude stockpiles increased 1.35 million barrels in the seven days ended Aug. 5, while the report may show that gasoline rose 900,000 barrels.

We should note that OPEC, which is responsible for about 40% of world oil supply, said in its monthly market report yesterday that it cuts its oil-demand forecasts for 2011 and next year as the global economic recovery loses momentum, also the group reduced its consumption estimate for this year by 150,000 barrels a day.

Still, there is a negative sentiment prevailing in the market, pushing stocks to the downside and sparking demand on refuges, as the S&P downgrade the U.S. is still having negative impact alongside the weak outlook for growth, yet with the Fed's decision a relief recovery might be favored to adjust to the new outlook for weaker growth.