WTI Crude Trades Near Two-Week Low on Fed Support for Tapering
West Texas Intermediate crude traded near the lowest level in almost two weeks as signs that the U.S. will taper economic stimulus this year raised speculation oil demand may falter in the world’s biggest consumer.
Futures were little changed in New York after declining for a third day yesterday as minutes of the U.S. Federal Reserve’s July policy meeting showed members were “broadly comfortable” with Chairman Ben S. Bernanke’s plan to start curbing bond buying later this year if the economy improves. An Energy Information Administration report showed crude stockpiles shrank by 1.4 million barrels last week. Enterprise Products Partners LP (EPD) said the Seaway pipeline was operating normally.
WTI for October delivery was at $103.60 a barrel, down 25 cents, in electronic trading on the New York Mercantile Exchange at 9:54 a.m. Sydney time. The volume of all futures traded was about 67 percent below the 100-day average. The contract slid $1.26 to $103.85 yesterday, the lowest close since Aug. 8.
Brent for October settlement fell 34 cents, or 0.3 percent, to $109.81 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark crude ended the session at a premium of $5.96 to WTI futures, the widest gap since June 26.
U.S. gasoline inventories declined 4 million barrels, said the EIA, the Energy Department’s statistical arm. They were projected to drop 1.5 million barrels, according to the median estimate of 11 analysts surveyed by Bloomberg News.
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