Crude oil futures for August dipped below $94 per barrel after the Energy Information Administration published data showing that gasoline inventories climbed sharply last week, but recovered to around $95 per barrel, representing a decline of just 0.3% on the day.
The price of crude has been supported by hopes that the Fed might maintain stimulus longer than previously thought, sparked by data today showing a significant and unexpected downward revision to first-quarter Gross Domestic Product (GDP).
GDP data is subject to a number of revisions before a final figure is arrived at: Q1 GDP had initially been estimated at an annualised rate of 2.5%, which was amended to 2.4% in the second estimate, and then finally slashed to 1.8%, with the biggest adjustment being made to personal consumption.
With the Fed only set to taper its stimulus should the economy continue to meet forecasts, this disappointing result would appear to support a longer time-frame for the current rate of asset purchases.
The EIA report showed that production of crude oil climbed last week by 1.9%, but overall stockpiles remained flat at 394.1 million barrels. Gasoline inventories rose sharply, jumping 3.65 million barrels to 225.4 million, far exceeding expectations. The rise in gasoline supplies came despite rising demand, as capacity utilisation expanded at refineries.