The forward outlook as seen from the US Federal Reserve is not done with influencing investors toward the year end. Fewer interest rate cuts from the US will not only reverberate now but echo all the way to the Presidential inauguration on January 25.
The oil market has at last experienced a seasonal demand indicator as seen in the Distillate draw in the US EIA Inventory Report. Stocks of the middle barrel product reduced by 3.2mb against a build expectation of 0.7mb. However, what brings seasonal cheer is at the current 4.5mbpd demand, it is the highest since early 2022.
Oil prices ought to see more of a reaction to the Crude inventory draw seen in the API data overnight. The feedstock saw a decline of 4.7mb against an expectation of -1.6mb. In addition, the implementation yesterday of the new sanctions by the EU on Russian shipping and the UK targeting a particular company should again give more buoyancy.
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