The Federal Reserve’s two day FOMC meeting began yesterday and is expected to end at 2:00 pm today with the first interest rate increase since 2006. With all of the recent signs pointing to an increase, it will be extremely surprising if the meeting results otherwise. A Reuters poll of 90 economists was taken earlier this month and showed the probability of a rate increase was 90%. A rise in interest rates will add support to the US dollar, making oil more expensive to those using other currencies.
API numbers released yesterday showed a larger-than-expected build in crude stocks, rising 2.3 million barrels. They also showed a build of 100,000 barrels in gasoline, a draw of 1.8 mill barrels in distillates and a build of 874,000 barrels of stocks in Cushing.
The DOE statistics were released today at 10:30 am and showed an increase of crude inventories of 4.8 million barrels from the previous week – meaning crude inventories are remaining at levels unseen for this time of year in over 80 years. Gasoline and distillate inventories are both in the upper half of their average range for this time of year at 1.7 and 2.6 million barrels, respectively. Diesel in New York Harbor is now 100% over this time last year.