Forexpros – Crude oil futures were steady in subdued trade on Wednesday, as markets awaited the outcome of the Federal Reserve’s policy setting meeting later in the day.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at USD88.17 a barrel during European morning trade, up 0.10%.
Investors remained on the sidelines ahead of the upcoming Fed announcement, amid speculation over whether the U.S. central bank will indicate if further quantitative easing measures are imminent.
Investors have interpreted signs of slowing U.S. economic growth as increasing the likelihood that the Federal Reserve will implement more quantitative easing to spur the economic recovery.
The U.S. is the world’s biggest oil-consuming country, responsible for almost 22% of global oil demand.
Investors also remained wary ahead of Thursday’s European Central Bank meeting, amid growing concerns that the bank will disappoint expectations for bold steps to counter the debt crisis in the euro zone.
Expectations have been mounting that the ECB will announce measures to lower Spanish and Italian borrowing costs after the bank’s head Mario Draghi pledged last week to do whatever is necessary to preserve the euro.
Crude traders shrugged off official data showed that Chinese manufacturing activity slumped to an eight-month low in July, as this week’s central bank meetings remained in focus.
While concerns over a possible slowdown in demand from the U.S. and China, the world’s leading oil consumers, have weighed on oil prices crude has remained supported by ongoing tensions in the Middle East, a major oil producing region.
Later Wednesday, the Energy Information Administration was to publish its weekly report on U.S. crude oil stockpiles.
On Tuesday, the American Petroleum Institute’s weekly report said U.S. crude oil inventories fell 11.6 million barrels in the week ended July 27, a far bigger drop than expected, as imports declined.
On the London based ICE Futures Exchange, Brent oil futures for September delivery was up 0.41% to trade at USD105.36 a barrel, with the spread between the Brent and crude contracts standing at USD17.19.
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