WASHINGTON (dpa-AFX) - Crude oil edged higher on Wednesday as the greenback weakened today amid reinforced expectations of a rate cut by the U.S. Federal Reserve.
WTI Crude Oil for January delivery was last seen trading up by $0.20 (or 0.34%) at $58.45 per barrel.
Yesterday's American Petroleum Institute data revealed that in the U.S., crude oil inventories decreased by 4.8 million barrels for the week ending December 5, way below expectations for a 1.7 million barrel draw, marking the third straight weekly decline.
In the prior week, crude oil inventories contracted by 2.48 million barrels.
In the U.S., the crude oil inventories are depicting a net increase of just 121,000 barrels for the year.
According to the U.S. Energy Information Administration, for the week ending December 5, crude oil inventories in the U.S. fell by 1.812 million barrels following a 0.574 million barrel rise the previous week.
For the same period, gasoline inventories jumped by 6,397,000 barrels following a 4,518,000 barrels rise in the previous week.
Similarly, an increase was seen in distillate inventories by 2.502 million barrels and heating oil inventories by 442,000 barrels.
The conflict between Venezuela and the U.S. is growing further.
In a new level of escalation, yesterday two U.S. fighter jets (F/A-18 Super Hornets) appeared near Maracaibo, the second-largest city in Venezuela before circling the Gulf of Venezuela for nearly an hour.
President Donald Trump has been accusing Venezuela of promoting illegal drug trafficking that penetrates into the U.S.
He stated in an interview with Politico that Venezuelan President Nicolas Maduro's days are 'numbered'.
However, Maduro rubbished the U.S. allegations and counter-accused Trump of resorting to unfair methods to plunder the oil reserves in Venezuela. Of note, Venezuela has abundant 'heavy' oil with over 300 billion barrels of reserves.
In Europe, the peace plan suggested by the U.S. to end the Russia-Ukraine war has been rejected by Ukraine and its allies. Ukrainian President Volodymyr Zelenskyy stated that Ukraine will never cede any territory to Russia.
Zelenskyy has drafted a revised proposal which he will be submitting to the U.S. negotiators.
On the production front, according to Argus estimates, the eight core members of OPEC+ that are unwinding production cuts increased crude output by 160,000 barrels per day in November. This hike implies that eight countries have increased output by 2.25 million barrels per day since they started retracting the production cuts on a monthly basis in April 2025.
Low price of oil this year has prompted China to aggressively stock its strategic petroleum reserves by 500,000 bpd.
Saad Rahim, Chief Economist of commodity-trading giant Trafigura has warned that oil market faces a 'super glut' next year while making the company's result announcement.
Trafigura's net profit has gone down to $2.7 billion for the fiscal year ending September from $2.8 billion of the previous year.
Today in the U.S., markets are almost fully pricing in a 25-basis-point interest rate cut following the U.S. central bank's two-day Federal Open Market Committee meeting which ends today.
The U.S. dollar index was last seen trading at 98.97, down by 0.25 (or 0.25%) today.
For the week ahead, vital market reports are due from the International Energy Agency and OPEC that could provide more clarity on the oil price outlook.
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