Crude oil futures steady as official data indicates inventory increase in US

Crude oil futures remained steady on Thursday morning as official data showed an increase in inventories in the US for the week ending January 24.

At 9.56 am on Thursday, April Brent oil futures were at $75.53, down by 0.11 per cent, and March crude oil futures on WTI (West Texas Intermediate) were at $72.61, down by 0.01 per cent.

February crude oil futures were trading at ₹6297 on Multi Commodity Exchange (MCX) during the initial hour of trading on Thursday against the previous close of ₹6294, up by 0.05 per cent, and March futures were trading at ₹6263 against the previous close of ₹6261, up by 0.03 per cent.

According to the US EIA (Energy Information Administration), commercial crude oil inventories in the US increased by 3.5 million barrels for the week ending January 24. At 415.1 million barrels, US crude oil inventories were about 6 per cent below the five-year average for this time of year.

Total motor gasoline inventories increased by 3 million barrels from last week and were slightly below the five-year average for this time of year. Finished gasoline inventories and blending components inventories increased last week.

Total products supplied in the US over the last four-week period averaged 20.3 million barrels a day, up by 2.5 per cent from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 8.3 million barrels a day, up by 1.8 per cent from the same period last year.

Distillate fuel product supplied averaged 3.9 million barrels a day over the past four weeks, up by 6.9 per cent from the same period last year. Jet fuel product supplied was up 4.5 per cent compared with the same four-week period last year.

US crude oil imports averaged 6.4 million barrels a day last week, a decrease of 297,000 barrels a day from the previous week. Over the past four weeks, crude oil imports averaged about 6.4 million barrels a day, 3.6 per cent more than the same four-week period last year.

Meanwhile, the US Federal Reserve left the interest rates unchanged at 4.25-4.5 per cent on Wednesday. Jerome Powell, Fed Chair, said there would be no rush to cut the rates again until data showed a renewed decline in inflation or rising risks in the jobs market.

A reduction in the interest rates will help boost the economic activities. This would help boost the demand for commodities such as crude oil.

Without making a direct reference to Fed’s stance on interest rates, the US President, Donald Trump, criticised the Fed Chair for his handling of inflation.

In a post on ‘Truth Social’ account on Wednesday, he said: “Because Jay Powell and the Fed failed to stop the problem they created with Inflation, I will do it by unleashing American Energy production, slashing Regulation, rebalancing International Trade, and reigniting American Manufacturing, but I will do much more than stopping Inflation, I will make our Country financially, and otherwise, powerful again! The Fed has done a terrible job on Bank Regulation. Treasury is going to lead the effort to cut unnecessary Regulation, and will unleash lending for all American people and businesses. If the Fed had spent less time on DEI, gender ideology, ‘green’ energy, and fake climate change, Inflation would never have been a problem. Instead, we suffered from the worst Inflation in the History of our Country!”

February aluminium futures were trading at ₹252.50 on MCX during the initial hour of trading on Thursday against the previous close of ₹252, up by 0.20 per cent.

On the National Commodities and Derivatives Exchange (NCDEX), April turmeric (farmer polished) contracts were trading at ₹13850 in the initial hour of trading on Thursday against the previous close of ₹13778, up by 0.52 per cent.

April kapas futures were trading at ₹1471 on NCDEX in the initial hour of trading on Thursday against the previous close of ₹1474, down by 0.20 per cent.

--EOM--