Oil drops 3% after Fed decision, US inventory data

Oil prices closed down 3% today, Feb. 1, after the monetary policy decision in the United States and amid assessment of the prospects for crude demand.

The US Federal Reserve decided to slow down the pace of interest rates hikes, to 25 basis points (bps) in a range of 4.5% and 4.75%, but expected a continued increase in borrowing costs.

US Energy Information Administration data showed that crude oil inventories rose by 4.1 million barrels in the week ended Jan. 27, contrary to expectations of a decline of one million barrels.

Gasoline stocks in the US rose by 2.6 million barrels, while US exports of crude fell by more than 1.2 million barrels.

Meanwhile, an OPEC+ committee recommended to keep the oil production policy agreed upon in November 2022 unchanged.

Brent crude futures for April delivery fell 3%, or $2.62, to $82.84 a barrel.

US WTI crude for March delivery slumped 3.1%, or $2.46, to reach $76.41 per barrel.