Oil prices drifted near three-month highs on Wednesday, with investors cautious ahead of an expected U.S. Federal Reserve rate hike later in the day and a spike in U.S. crude supplies.
Brent crude futures slipped 70 cents to $82.94 a barrel, while U.S. West Texas Intermediate (WTI) crude was at $78.91, down 72 cents. Both hit three-month highs on Tuesday.
Oil prices have been rallying for four weeks, with investors buoyed by signs of tighter supplies, namely output cuts by the Organization of the Petroleum Exporting Countries (OPEC) and allies, as well as pledges by Chinese authorities to shore up the world’s second-biggest economy.
The Fed’s policy meeting started on Tuesday, and it is widely expected the U.S. central bank will deliver a 25-basis-point rate hike when it concludes.
Meanwhile, U.S. crude stocks rose by about 1.32 million barrels in the week ended July 21, according to market sources citing American Petroleum Institute figures on Tuesday. Analysts polled by Reuters had expected a 2.3-million-barrel drawdown.
U.S. government data on inventories is due on Wednesday.
