Crude rises after United States fed rate hike, gains limited

“Given that prompt WTI-Brent spreads are trading in a narrow range and US production is falling due to lower spending, the (policy) shift is likely to have limited impact on prices beyond initial knee-jerk reaction”, Chauhan said. The same would affect USA crude supplies to Europe.

But the weak Canadian dollar, which has fallen alongside plummeting oil prices, is 80 per cent of the reason, costing Canadians about eight cents a litre in potential savings at the pump, he said. Canada’s supply from the oil sands is largely heavy, requiring more complex refining than the light shale oil from the Bakken and Texas regions such as the Eagle Ford.

Oil prices have dropped significantly since the he Organisation of the Petroleum Exporting Countries (OPEC) December decision to keep crude production pumping at current level in the already-oversupplied market.

An end to the U.S.’s 40-year ban on oil exports is probably not what OPEC needs right now.

An elimination of the export ban will create an estimated 1 million American jobs, resulting in an additional $170 billion for the USA economy, Ryan said in a statement. As well, refineries in New Brunswick and Quebec have been importing crude by ship from the U.S. Gulf Coast.

The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, surged more than 0.85% to an intraday-high of 99.27. That is why they have done everything they can to sink the USA oil producer because they knew this day was coming.

European benchmark Brent crude for February was down nine cents to US$36.97.

“What you see is what you’re going to get”, he said, adding that gas prices will likely stay around 99.9 cents per litre in Toronto until Christmas.

That’s why I had to laugh when I was reading that the congressional deal was the reason oil was down overnight. In its most recent weekly tally, the Energy Information Administration reported inventories rose by 4.8 million barrels, the 11th increase in 12 weeks. Indonesia aims to increase its processing capacity by about 40 percent by 2025 to 1.73 million barrels a day.

Crude futures fell in Asian trade on Thursday, adding to sharp losses the previous session after the Federal Reserve raised rates for the first time in almost a decade and official figures showed a surprise build in USA inventories.