Investing.com - Crude oil futures were slightly higher during European morning hours on Wednesday, as market players focused on a meeting of the Organization of the Petroleum Exporting Countries, as well as the conclusion of the Federal Reserve’s policy-setting meeting later in the trading day.
Oil traders also looked ahead to closely-watched weekly supply data on U.S. stockpiles of crude and refined products from the U.S. Energy Information Administration later Wednesday.
On the New York Mercantile Exchange, light sweet crude futures for delivery in January traded at USD86.14 a barrel during European morning trade, up 0.45% on the day.
New York-traded oil prices traded in a tight range between USD85.64 a barrel, the daily low and a session high of USD86.19 a barrel.
OPEC’s oil exporting member nations will meet in Vienna later Wednesday to discuss their production quotas. The oil cartel is widely expected to leave its official target unchanged at 30 million barrels a day.
Investors also focused on the outcome of the Federal Reserve’s policy meeting later in the day, amid expectations the central bank will continue to pursue a policy of monetary easing in order to support the U.S. economic recovery.
Many analysts expect the Fed to announce monthly bond purchases of USD45 billion. The U.S. central bank vowed in September to buy USD40 billion in mortgage securities each month until the economy improves in a third round of what is known as quantitative easing, or QE3.
The U.S. dollar was on the backfoot ahead of the Fed decision. The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, traded at 80.22, close to a one-week low.
Oil prices typically strengthen when the U.S. currency weakens as the dollar-priced commodity becomes cheaper for holders of other currencies.
Oil traders now looked ahead to weekly data from the U.S. government on oil supplies later in the day to gauge the strength of demand from the world’s largest oil consumer.
The report was expected to show that U.S. crude oil stockpiles declined by 2.34 million barrels last week, while gasoline inventories were forecast to rise by 2.2 million barrels.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories rose by 4.27 million barrels last week, while gasoline stocks increased 2.76 million barrels.
Meanwhile, investors continued to monitor developments surrounding the fiscal cliff in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1, unless a divided Congress and the White House can work out a compromise in the three weeks left before the deadline.
Without a deal, the U.S. could fall back into recession and drag much of the world down with it.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for January delivery added 0.5% to trade at USD107.24 a barrel, with the spread between the Brent and crude contracts standing at USD21.10 a barrel.
Oil traders also looked ahead to closely-watched weekly supply data on U.S. stockpiles of crude and refined products from the U.S. Energy Information Administration later Wednesday.
On the New York Mercantile Exchange, light sweet crude futures for delivery in January traded at USD86.14 a barrel during European morning trade, up 0.45% on the day.
New York-traded oil prices traded in a tight range between USD85.64 a barrel, the daily low and a session high of USD86.19 a barrel.
OPEC’s oil exporting member nations will meet in Vienna later Wednesday to discuss their production quotas. The oil cartel is widely expected to leave its official target unchanged at 30 million barrels a day.
Investors also focused on the outcome of the Federal Reserve’s policy meeting later in the day, amid expectations the central bank will continue to pursue a policy of monetary easing in order to support the U.S. economic recovery.
Many analysts expect the Fed to announce monthly bond purchases of USD45 billion. The U.S. central bank vowed in September to buy USD40 billion in mortgage securities each month until the economy improves in a third round of what is known as quantitative easing, or QE3.
The U.S. dollar was on the backfoot ahead of the Fed decision. The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, traded at 80.22, close to a one-week low.
Oil prices typically strengthen when the U.S. currency weakens as the dollar-priced commodity becomes cheaper for holders of other currencies.
Oil traders now looked ahead to weekly data from the U.S. government on oil supplies later in the day to gauge the strength of demand from the world’s largest oil consumer.
The report was expected to show that U.S. crude oil stockpiles declined by 2.34 million barrels last week, while gasoline inventories were forecast to rise by 2.2 million barrels.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories rose by 4.27 million barrels last week, while gasoline stocks increased 2.76 million barrels.
Meanwhile, investors continued to monitor developments surrounding the fiscal cliff in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1, unless a divided Congress and the White House can work out a compromise in the three weeks left before the deadline.
Without a deal, the U.S. could fall back into recession and drag much of the world down with it.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for January delivery added 0.5% to trade at USD107.24 a barrel, with the spread between the Brent and crude contracts standing at USD21.10 a barrel.