MW: Oil futures gain 1% ahead of Fed decision, supply data
Oil futures gained early Wednesday, as rising U.S. stock futures and dollar weakness boosted sentiment among energy traders, who seemed to shrug off a worse-than-expected contraction in the American economy.
Investors are also awaiting the Federal Reserve's monetary policy decision as well as data on U.S. petroleum supplies, both due later in the session.
Crude oil for June delivery rose 62 cents, or 1.2%, to $50.54 a barrel in electronic trading on Globex.
On Wall Street, U.S. stock futures pointed to a higher opening, with negative economic data failing to stop the advance. See Indications.
The Commerce Department reported Wednesday that real gross domestic product fell at a 6.1% annualized rate in the first quarter, nearly matching the 6.3% decline in the fourth quarter of 2008. The two-quarter contraction is the worst in more than 60 years.
The 6.1% decline in GDP was larger than the 5.1% contraction expected by economists surveyed by MarketWatch. See Economic Report.
At 2:15 p.m. Eastern, the Fed will release a policy statement after its two-day meeting.
Supply data ahead
Also ahead is data on petroleum supplies from the Energy Information Administration, due at 10:30 a.m.
Analysts expect U.S. crude stocks to have increased 1.8 million barrels last week, according to a Platts survey. They also expect a rise of 900,000 barrels in gasoline supplies as well as an increase of 1.3 million barrels of distillate stocks, the survey showed.
Late Tuesday, the American Petroleum Institute reported a rise of 4.6 million barrels in commercial crude stocks, a fall of 2.6 million barrels in gasoline stocks, and a rise of 2.6 million barrels in distillate supplies, according to MF Global.
In the currency markets, the U.S. dollar was mostly weaker against its major rivals. Dollar weakness typically benefits dollar-denominated commodities because it makes them cheaper for holders of other currencies. See Currencies.
Also on Globex, May reformulated gasoline gained 2 cents to $1.42 a gallon and May heating oil rose 2 cents to $1.33 a gallon. May natural gas futures fell 6 cents to $3.27 per million British thermal units.
