{"id":41393,"date":"2023-07-27T23:35:56","date_gmt":"2023-07-28T03:35:56","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/oil-prices-post-first-loss-in-5-sessions-as-u-s-crude-supplies-fall-less-than-expected-fed-hikes-rates\/"},"modified":"2023-07-27T23:35:58","modified_gmt":"2023-07-28T03:35:58","slug":"oil-prices-post-first-loss-in-5-sessions-as-u-s-crude-supplies-fall-less-than-expected-fed-hikes-rates","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=41393","title":{"rendered":"Oil prices post first loss in 5 sessions as U.S. crude supplies fall less than expected, Fed hikes rates"},"content":{"rendered":"<div id=\"js-article__body\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0002324002\" role=\"document\">\n<p>Oil futures finished lower Wednesday for the first time in five trading sessions, with prices falling back from the three-month high they settled at a day earlier.  <\/p>\n<p>Losses for oil came on the heels of smaller-than-expected weekly declines in U.S. crude, gasoline and distillate inventories reported by the Energy Information Administration. <\/p>\n<div class=\"paywall\">\n<h2>Price action<\/h2>\n<ul class=\"articleList\">\n<li>\n      West Texas Intermediate crude for September delivery<br \/>\n        CL.1,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/211629951\/delayed\" class=\"negative\">-0.36%<\/bg-quote><br \/>\n       fell 85 cents, or 1.1%, to settle at $78.78 a barrel on the New York Mercantile Exchange.<\/p>\n<\/li>\n<li>\n      September Brent crude<br \/>\n        BRNU23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/209705622\/delayed\" class=\"negative\">-0.44%<\/bg-quote><span>,<\/span><br \/>\n       the global benchmark, lost 72 cents, or 0.9%, at $82.92 a barrel on ICE Futures Europe. October Brent<br \/>\n        BRN00,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/209704782\/delayed\" class=\"negative\">-0.42%<\/bg-quote><\/p>\n<p>        BRNV23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/209705496\/delayed\" class=\"negative\">-0.42%<\/bg-quote><span>,<\/span><br \/>\n       the most actively traded contract, declined 69 cents, or 0.8%, to $82.56 a barrel.<\/p>\n<\/li>\n<li>\n      Back on Nymex, August gasoline<br \/>\n        RBQ23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/215376523\/delayed\" class=\"negative\">-0.44%<\/bg-quote><br \/>\n       rose 1.9% to $2.91 a gallon, while August heating oil<br \/>\n        HOQ23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/215376442\/delayed\" class=\"negative\">-0.62%<\/bg-quote><br \/>\n       added nearly 2.4% at $2.84 a gallon.<\/p>\n<\/li>\n<li>\n      August natural gas<br \/>\n        NGQ23,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210192744\/delayed\" class=\"negative\">-6.00%<\/bg-quote><br \/>\n       fell 2.4% to $2.67 per million British thermal units ahead of the contract\u2019s expiration at the end of Thursday\u2019s session.<\/p>\n<\/li>\n<\/ul>\n<h2>Fed impact<\/h2>\n<p>Both WTI and Brent retreated Wednesday from Tuesday\u2019s settlement at their highest prices since April 18. Prices had been supported by expectations for a supply deficit in the second half of the year.<\/p>\n<p>Given ongoing cuts by Saudi Arabia, and the Atlantic hurricane season, strength in the energy complex is likely to continue in the days and weeks ahead, said Tariq Zahir, managing member at Tyche Capital Advisors.<\/p>\n<p>Upside for oil, however, has been limited by fears of aggressive monetary tightening by global central banks that could spark a significant economic slowdown.<\/p>\n<p>On Wednesday afternoon, the U.S. central bank raised its benchmark interest rate by a quarter-percentage point to a 22-year high. It also said it was prepared to do more to bring \u201celevated\u201d inflation down. <\/p>\n<p>While the Fed is \u201ccontinuing to say they are prepared to raise rates further and keep policy restrictive for a prolonged period of time, the markets simply don\u2019t believe that,\u201d Tyler Richey, co-editor at Sevens Report Research, told MarketWatch. <\/p>\n<p>\u201cThat lack of faith is underscored by Fed funds futures pricing in a more than 50% chance of a rate-cut by the end of Q1 [2024] since the Fed announcement,\u201d he said.<\/p>\n<p> Fed Chairman Powell said that depending on economic data, it was \u201ccertainly possible\u201d the Fed would delivery another rate hike in September, or hold steady. <\/p>\n<p>\u201cAs long as the market is right and the Fed will both achieve a soft economic landing and begin easing policy rates in the quarters ahead,\u201d which is something we don\u2019t anticipate, said Richey, then oil can \u201cextend this mid-summer rally.\u201d<\/p>\n<p>However, \u201cif we see Fed policy expectations take a hawkish shift and hard-landing\/recession fears return, then we expect pain in energy markets as risks to consumer demand would be quickly repriced into the market,\u201d he said.<\/p>\n<h2>Supply data<\/h2>\n<p>The Energy Information Administration on Wednesday reported that U.S. commercial crude inventories fell by 600,000 barrels for the week ended July 21.<\/p>\n<p>On average, analysts polled by S&amp;P Global Commodity Insights expected the report to show a decrease of 4.4 million barrels. The American Petroleum Institute late Tuesday reported a weekly increase of 1.3 million barrels, according to a source citing the data.<\/p>\n<p>The EIA report also revealed supply falls of 800,000 barrels for gasoline and 200,000 barrels for distillates for the week. Analysts had forecast weekly inventory declines of 2 million barrels for gasoline and 2.3 million for distillates. <\/p>\n<p><strong>Read:<\/strong> Here\u2019s what might lead to a 10% spike in retail gasoline prices<\/p>\n<p>U.S. refinery use fell 0.9% to 93.4%, which helps \u201cexplain the notably smaller than expected drawdown in oil stockpiles,\u201d said Sevens Report Research\u2019s Richey. \u201cHowever, if consumer demand was still strong we should have seen some larger drawdowns in the refined products, which further supports the thesis that demand for fuel at the pump is faltering.\u201d<\/p>\n<p>Last week, the gasoline supplied figure, which is an implied measure of consumer demand for fuel at the pump, stabilized with a modest rise of 85,000 barrels a day to 8.94 million barrels a day, said Richey. That followed sharp declines in the previous two reports, in the middle of the summer driving season.<\/p>\n<\/p><\/div>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.marketwatch.com\/story\/oil-prices-pull-back-from-3-month-highs-ahead-of-fed-decision-fd65ba4d?mod=investing\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Oil futures finished lower Wednesday for the first time in five trading sessions, with prices falling back from the three-month high they settled at a day earlier. Losses for oil came on the heels of smaller-than-expected weekly declines in U.S. crude, gasoline and distillate inventories reported by the Energy Information Administration. Price action West Texas [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":41394,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-41393","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Oil prices post first loss in 5 sessions as U.S. crude supplies fall less than expected, Fed hikes rates | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Oil futures finished lower Wednesday for the first time in five trading sessions, with prices falling back from the three-month high they settled at a day\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" 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