WTI corrects to near $82.40 on profit booking, eyes on FOMC monetary policy

• WTI price inches lower on market caution ahead of Fed decision.
• The higher US Dollar dampens Crude oil demand.
• API Weekly Crude Oil Stock declined by 1.519 million barrels, contrasting with the previous decrease of 5.521 million barrels.

West Texas Intermediate (WTI) oil price edges lower to near $82.40 per barrel during the Asian trading hours on Wednesday, as Crude oil prices corrected from recent highs, with investors booking profits. Additionally, the market has adopted a cautious stance ahead of the US Federal Reserve’s interest rate decision. The higher US Dollar (USD) is also making oil more expensive for countries with different currencies, thereby impacting oil demand.

Market analysts have highlighted Ukraine's drone strikes on Russian oil refineries, which account for at least 10% of Russia’s total oil processing capacity. Although Crude oil prices reached near five-month highs on Tuesday due to supply concerns. However, the drop in Russian refining capacity has led to an increase in Crude oil exports from Russia, according to Reuters.

However, the American Petroleum Institute reported the Weekly Crude Oil Stock for the week ending on March 15, fell by 1.519 million barrels compared to the expected increase of 0.077 million barrels and the previous decrease of 5.521 million barrels.

Energy pipeline company Enbridge is considering expanding the capacity of its Gray Oak oil pipeline by 80,000 barrels per day (bpd) in 2024, with the possibility of adding another 40,000 bpd in 2025, according to Reuters. Originally, the company had planned to increase capacity by 200,000 bpd for the Texas pipeline, but in February, it revised its target to between 100,000 bpd and 200,000 bpd.

Meanwhile, Iraq has announced intentions to reduce its crude exports to 3.3 million bpd in the coming months to comply with its OPEC+ quota. Additionally, Saudi Arabia has experienced a second consecutive monthly decline in Crude exports.