Oil edged higher as U.S. crude stockpiles were set to have fallen last week, while the dollar slid again. Futures in New York rose 1.1%. U.S. inventories fell by 6.83 million barrels, the American Petroleum Institute reported but said that gasoline supplies rose, according to people familiar with the data. The Bloomberg Dollar Spot index fell 0.3%, heading for its lowest close since September 2018. Investors are waiting for the conclusion of a Federal Reserve policy meeting on Wednesday, with the U.S. central bank expected to signal it will keep interest rates near zero for longer as the coronavirus continues to surge. Florida reported a record death toll, while a resurgence of cases across the Asia-Pacific is being viewed as an early warning sign for the rest of the world.
After rebounding swiftly from April lows, crude prices have struggled to find direction in recent weeks as the resurgent pandemic threatens the global energy demand recovery. Consultant Rystad Energy AS said it expects a second virus wave and additional barrels from the OPEC+ alliance to result in a global supply glut for the next four months. “The upshot is that the specter of renewed containment measures looms large” over the market, said PVM Oil Associates analyst Stephen Brennock. “All the while, market players await further U.S. stimulus.”