Crude inventories decline although less than forecast
U.S. crude-oil futures bounced back on Wednesday, 17 December 2014 rebounding from a five-year low after data showed crude inventories declined, although less than forecast.
Crude futures for delivery in January settled higher by 54 cents, or 1%, at $56.47 a barrel on the New York Mercantile Exchange. Oil had traded as low as $54.21 in earlier action, its lowest level since May 2009, then jumped by as much as 5% to nearly $59 before giving back most of that gain.
In the latest weekly inventory report, the U.S. Energy Information Administration reported a smaller-than-expected decline in U.S. crude supplies in the week ended 12 December 2014.
Crude inventories declined by 800,000 barrels in the week while traders had expected a decline of 2.5 million barrels.
As expected by some, the Fed removed the "considerable time" language from its policy statement, but that reference was replaced with a call for "patience," which essentially conveyed the same message. Above all, Chair Yellen reiterated that the central bank will remain data-dependent and reserves the right to accelerate, or defer, a rate hike in accordance with what the data are communicating about the progress being made toward the Fed's dual mandate. With regard to inflation, Ms. Yellen touched on the drop in oil prices during her press conference, but showed little concern, saying the decline is expected to be transitory.
The dollar inched up against most major rivals. Commodities such as gold that trade in dollar terms often are hurt by a stronger greenback.
In electronic trading late Wednesday, the U.S. oil benchmark stayed moderately higher — up 0.3% at last check — in the wake of what some analysts described as a more-dovish-than-anticipated Federal Reserve statement.
Elsewhere in energy trading, gasoline for January delivery rose by 3 cents to settle at $1.57 a gallon on the Nymex. January heating oil gained 5 cents to end at $2.01 a gallon on the Nymex.
