Oil Futures Rise After Fed Keeps Interest Rate Policy Steady


   
Maria Eugenia Garcia
DTN Energy Editor

   HOUSTON TX (DTN) -- The front-month NYMEX WTI and ICE Brent futures contract 
edged up Wednesday following the Federal Reserve's decision to leave its 
interest rates policy unchanged after concluding today a two-day meeting of the 
Federal Reserve Open Market Committee.

   The Committee also decided to maintain the target range for the federal 
funds rate at 4% to 4.5%.

   "Recent indicators suggest that economic activity has continued to expand at 
a solid pace. The unemployment rate has stabilized at a low level in recent 
months, and labor market conditions remain solid," the FOMC said in a 
statement. However, the Committee also acknowledged that inflation "remains 
somewhat elevated."

   The Fed's decision was in line with market expectations and helped set the 
bullish tone in the oil futures market, which had been under downward pressure 
due to concerns about the potential impact of tariffs imposed by the United 
States on imports from China, Canada, Mexico and the European Union, which 
could affect U.S. economy growth.

   Separately, Energy Information Administration and American Petroleum 
Institute data showed another weekly build of commercial crude inventory, while 
gasoline and distillate supply stocks declined again last week.

   The EIA reported today that the commercial crude oil inventories in the U.S. 
rose by 1.7 million bbl to 437 million bbl in the week ending March 14. This 
was below the 4.593 million bbl build reported by API yesterday (3/18) for the 
same reference week.

   Gasoline stocks dropped by 500,000 bbl week-over-week to reach 240.6 million 
bbl, in the week ended March 14. This was above the 1.71 million bbl decrease 
reported by API for the same period.

   Distillate fuel stocks recorded the steepest draw by falling 2.8 million bbl 
to 114.8 million bbl last week, according to EIA, which was larger than the 
1.14 million bbl fall API reported for the same week.

   The April NYMEX WTI futures contract edged up by $0.36 to $67.26 bbl while 
the front-month ICE Brent futures contract rose by $0.32 to $70.88 bbl. April 
RBOB futures contract inched up $0.003 to $2.1687 gallon and April ULSD futures 
increased by $0.0403 to $2.2348 gallon.

   The U.S. dollar index rose by 0.34% to 103.23 against a basket of foreign 
currencies.

    




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