Market expects commercial crude stocks to have risen 3.5 million barrels during last week
Crude-oil futures rose more than 2% on Tuesday, 27 January 2015 at Nymex as some optimism about curtailing output seemed to permeate markets and ahead of a fresh weekly report on stockpiles. Traders digested comments from key Middle Eastern oil officials in recent days, including a statement on Tuesday from Saudi Aramco Chief Executive Khalid al-Falih that Saudi Arabia would not be able to balance crude markets alone.
Light, sweet crude futures for delivery in March rose $1.08, or 2.4%, to settle at $46.23 a barrel on the New York Mercantile Exchange. The settlement snapped a three-day losing streak. Prices had weaved in and out of the red earlier in the day, trading as low as $44.81 a barrel and as high as $46.55 a barrel.
On Monday, Abdallah el-Badri, the Organization of the Petroleum Exporting Countries' secretary-general, said oil at $200 a barrel would be possible if producers don't invest in new supply, and prices around $45 a barrel to $55 a barrel are likely the bottom for crude. El-Badri, however, also stated OPEC is likely to stand by its decision to keep output the same.
Market expects commercial crude stocks to have risen 3.5 million barrels during the week ended 23 January 2015. That would match a five-year average as tracked by the Energy Information Administration.
Just before the opening on Tuesday companies like Caterpillar, Procter & Gamble, and Microsoft issued weaker-than-expected earnings reports. There was a heavy slate of U.S. economic data out Tuesday that included durable goods orders, the S&P/Case-Shiller home price index, the U.S. flash services PMI, the consumer confidence index, and new residential sales. The data was a mixed bag and had little collective impact on the markets.
New York City missed the major impact of a massive winter storm that is pummeling the northeastern U.S. Tuesday. However, some New York-based markets' trading volumes were a bit thinner due to the storm.
The regular meeting of the U.S. Federal Reserve's Open Market Committee (FOMC) began on Tuesday and ends Wednesday afternoon. Traders will look for clues coming from that meeting, regarding when the U.S. central bank will begin to raise interest rates. Recent developments, including plunging crude oil prices, have led many to believe the Fed might not raise interest rates until late this year, or may have to wait until 2016.
Among other energy products, gasoline for February rose 3 cents, or 2.5%, to $1.3501 a gallon on Nymex, while February heating oil gained 2 cents, or 1.4%, to $1.6628 a gallon on Nymex.
February natural gas advanced 10 cents, or 3.5%, to $2.9810 per million British thermal units. The contract, which is set to expire on Wednesday, slumped 3.5% on Monday.
