WTI oil futures trim gains after U.S. supply data

Investing.com - West Texas Intermediate oil futures came off the highest levels of the session on Wednesday, after data showed that oil supplies in the U.S. fell unexpectedly last week, while gasoline and distillate supplies surged.

On the New York Mercantile Exchange, crude oil for delivery in February tacked on 46 cents, or 0.96%, to trade at $48.39 a barrel during U.S. morning hours. Prices were at around $48.95 a barrel prior to the storage report.

Earlier in the day, New York-traded oil futures plunged to $47.09, the weakest level since April 2009.

A day earlier, Nymex oil futures plunged $2.11, or 4.22%, to settle at $47.93 a barrel.

The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories decreased by 3.1 million barrels in the week ended January 2, compared to expectations for an increase of 0.9 million barrels.

Total U.S. crude oil inventories stood at 382.4 million barrels as of last week.

The report also showed that total motor gasoline inventories increased by 8.1 million barrels, above expectations for a gain of 3.4 million, while distillate stockpiles rose by 11.2 million barrels.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for February delivery hit a low of $49.70 a barrel, a level not seen since May 2009, before recovering to trade at $51.01, down 10 cents, or 0.19%.

On Tuesday, London-traded Brent prices tumbled $2.01, or 3.78%, to close at $51.10 a barrel.

The US dollar index, which measures the greenback against a basket of six major currencies, climbed to a nine-year high, boosted by the diverging policy outlook between the Federal Reserve and central banks in Europe and Japan.

Oil prices typically weaken when the U.S. currency strengthens as the dollar-priced commodity becomes more expensive for holders of other currencies.

Payroll processing firm ADP said in a report earlier that non-farm private employment rose by a seasonally adjusted 241,000 last month, above expectations for an increase of 226,000.

The economy created 227,000 jobs in November, whose figure was upwardly revised from a previously reported 208,000.

While not viewed as a reliable guide for the government jobs report due on Friday, January 9, it does give guidance on private-sector hiring.

Investors now looked ahead to the minutes of the Federal Reserve’s December meeting, due out later in the day, which were expected to provide further indications on the future direction of monetary policy.

Brent prices lost nearly 48% in 2014, while WTI futures dropped almost 46% after the Organization of Petroleum Exporting Countries decided to maintain its output target at 30 million barrels a day.

The decision disappointed hopes the oil cartel would lower production to support the market, as a surplus develops amid the shale boom in the U.S., which is pumping at the fastest pace in more than 30 years.