Crude Oil barely moves on the Fed hold as Iran weighs a Qatari deal
- WTI barely moves on the Fed hold and stays near $102.00, up from below $100.00.
- US Crude Oil stocks fell 1.9 million barrels, and gasoline gained 3.9 million.
- Iran is expected to answer a Qatari draft deal to end the war by Friday.
The Fed's hold matters less to Crude Oil than a Qatari draft deal to end the war, which Iran is expected to answer before the weekend. WTI barely moved on the statement and is trading near $102.00, below a session high short of $103.00 from before the decision.
Qatari mediators gave Iran the draft, and an official told Reuters on Wednesday that Tehran is considering it. The Wall Street Journal reported that Washington has told Gulf states to prepare for a possible renewed US campaign against Iran after the November 3 midterms. Either outcome changes how much Gulf Crude Oil reaches buyers, the supply WTI is priced against.
The Energy Information Administration (EIA) said US Crude Oil stocks, the barrels behind WTI, fell 1.9 million in the week to October 23 while gasoline stocks rose 3.9 million. The World Bank expects global supply to fall 5.2% in 2026, the most in over four decades outside 2020. On the same Wednesday, Abu Dhabi National Oil Company (ADNOC) told customers its pipeline around the Strait of Hormuz starts in early 2027.
On the calendar
Tehran's reply to the Qatari draft is expected before the weekend, with no day set. Thursday's 12:30 GMT advance estimate of third-quarter US Gross Domestic Product (GDP) is the week's main read on the US demand behind WTI.
Fed Chair Warsh's Wednesday press conference, at 18:30 GMT, is his first public comment since Fed officials went quiet on October 17. He called inflation uncomfortably high the day before. Whether he blames energy costs spreading into other prices bears on a December hike, which would fall on that same US demand.
On the charts
WTI started Wednesday just under $100.00 and has climbed for most of the session, with one of its larger steps in the bars after the EIA report. It gave back more than half of the climb since that report in a single five-minute bar before the decision. Intraday momentum has turned up from near oversold.
WTI spot 5-minute chart
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The Fed funds rate is the overnight rate at which US banks lend to each other. It is the oft-quoted headline rate set by the Federal Reserve at its FOMC meetings. It is set as a range, for example 4.75%-5.00%, though the upper limit (in that case 5.00%) is the quoted figure. Market expectations for future Fed funds rate are tracked by the CME FedWatch tool, which shapes how many financial markets behave in anticipation of future Federal Reserve monetary policy decisions.
Author
Joshua Gibson
FXStreet
Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.
