IV:Crude oil futures decline ahead of U.S. supply data, Bernanke
Investing.com - Crude oil futures were lower on Wednesday, as investors looked ahead to closely-watched weekly supply data on stockpiles of crude and refined products from the U.S. Energy Information Administration later in the day.
Market players also looked ahead to Federal Reserve Chairman Ben Bernanke’s testimony to Congress later in the day.
On the New York Mercantile Exchange, light sweet crude futures for delivery in September traded at USD105.10 a barrel during European morning trade, down 0.55% on the day.
New York-traded oil prices fell by as much as 1% earlier in the session to hit a daily low of USD104.89 a barrel.
New York-traded oil prices rose to a 16-month high of USD107.44 a barrel on July 11.
Oil traders were awaiting data from the U.S. government on oil and fuel supplies later in the day to gauge the strength of demand from the world’s largest oil consumer.
The report was expected to show that U.S. crude oil stockpiles declined by 2 million barrels last week, while gasoline inventories were forecast to fall by 0.5 million barrels.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories fell by 2.6 million barrels last week, compared to expectations for a decline of 2.5 million barrels.
Market participants were also anticipating Bernanke's testimony on monetary policy amid speculation over the timing of a possible reduction to the bank’s USD85 billion-a-month bond buying program.
Oil prices rallied 2.3% last week after Federal Reserve Chairman Ben Bernanke said the central bank will continue to maintain accommodative monetary policy for the foreseeable future.
The Fed’s stimulus program is viewed by many investors as a key driver in boosting the price of commodities as it tends to depress the value of the dollar.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for September delivery shed 0.4% to trade at USD107.68 a barrel, with the spread between the Brent and crude contracts standing at USD2.58 a barrel.
The gap between the contracts narrowed to the smallest level since November 2010 last week, amid an improving production outlook in the North Sea and indications of declining stockpiles at Cushing, Oklahoma, the delivery point for Nymex oil futures.
