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Oil Price Gains Ease with Focus on US Stockpiles and Fed Moves
Wednesday, 17 September 2025 23:23 WIB | OIL |Minyak WTIbrent oil

Oil prices weakened after three consecutive sessions of gains as traders assessed the latest US stockpiles data and awaited the Federal Reserve's interest rate decision later Wednesday.

West Texas Intermediate (WTI) prices held around $64 per barrel after rising 3.4% in the previous three sessions. The commodity weakened as traders shrugged off the latest US stockpiles data, which showed crude inventories fell by 9.29 million barrels amid a significant increase in exports.

However, adjustment factors surged and distillate inventories rose to their highest level since January, adding to the bearish bias of the report. "Traders want to see domestic demand pulling up inventories," rather than exports, said Dennis Kissler, senior vice president for trading at BOK Financial Securities.

The distillate buildup also hampered the rally following Ukraine's attack on the Saratov refinery, the latest attack on Russian energy facilities—which has helped cut OPEC+ member production to post-pandemic lows, according to Goldman Sachs Group Inc. However, the strike hasn't been enough to push oil out of the $5 range it has held for much of the past month and a half, oscillating between geopolitical tensions and weakening fundamentals.

The accelerated return of OPEC+ supply has raised expectations of a looming oversupply later in the year, while surging oil tanker earnings offer a signal of higher production.

Later Wednesday, the Federal Reserve is expected to make its decision on interest rates. A quarter-point cut and three more in April are currently priced in.

"The possibility of a rate cut itself is already fully priced in; what matters is the wording and projections," City Index and Forex.com analyst Fawad Razaqzada wrote in a note, referring to a 25 basis point cut. "Traders want to see clues about the exact cutting cycle."

Brent's implied volatility eased for the second month after falling to its lowest level in more than three weeks on Monday, as prices remained within the narrow range seen since early August. (alg)

Source: Bloomberg

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