The price of oil rose on Wednesday, before the conclusion of the U.S. Federal Reserve meeting.
Benchmark oil for July delivery rose 48 cents to $98.92 per barrel at late afternoon Bangkok time in electronic trading on the New York Mercantile Exchange. The contract rose 67 cents to close at $98.44 a barrel on the Nymex on Tuesday.
To help support the U.S. economic recovery, the Fed has been buying $85 billion in bonds every month in an attempt to keep long-term interest rates low and encourage lending. The new money generated has flowed into the financial system, helping many assets, including oil, to climb from the lows witnessed during the global recession following the 2008-2009 financial crisis.
The Fed will follow the end of a two-day meeting Wednesday with a news conference by Fed chairman Ben Bernanke.
Investors want to hear if the Fed plans to gradually phase out its bond-buying program. Markets have been volatile over the past weeks as uncertainty about the Fed’s intentions rattled investors. Recent data that shows the U.S. economy recovering in fits and starts has led few analysts to expect the Fed to wind down its program in the very near term.
Oil traders will also be monitoring fresh information on U.S. stockpiles of crude and refined products from the U.S. Energy Department and the American Petroleum Institute.
Data for the week ending June 14 is expected to show a decline of 1 million barrels in crude oil stocks and an increase of 1.2 million barrels in gasoline stocks, according to a survey of analysts by Platts, the energy information arm of McGraw—Hill.
Brent crude, a benchmark for many international oil varieties, gained 49 cents to $106.51 a barrel on the ICE Futures exchange in London.
In other energy futures trading on the Nymex-
Wholesale gasoline added 1.3 cents to $2.8725 a gallon. Heating oil rose 1.9 cents to $2.9826 per gallon.
Natural gas gained 1 cent to $3.915 per 1,000 cubic feet.