Update: WTI Oil Closes Lower Even U.S. Inventories Fall and the Fed Cuts Interest Rates

02:42 PM EDT, 09/17/2025 (MT Newswires) -- West Texas Intermediate (WTI) closed lower on Wednesday following three days of gains, sticking within the tight range it has mostly remained within for more than a month, even as a report showed a much larger than expected drop in U.S. oil inventories and the Federal Reserve cut U.S interest rates cut interest rates for the first time this year.

WTI crude oil for October delivery closed down US$0.47 to settle at US$64.05 per barrel, while November Brent crude was last seen down US$0.56 to US$67.91.

WTI has traded in a tight range since Aug. 8, trading near US$65 while rising above that mark only once in the past five weeks. Prices are being supported by supply worries as Ukraine steps up attacks on Russian oil infrastructure amid continuing violence in the Middle East even as global supply is on the rise following 2.2-million barrels per day of OPEC+ supply increases.

The market is also eyeing a weakening U.S. dollar, which is trading near a four-year low as the Federal Reserve, as expected, cut U.S. interest rates 25 basis points. A lower dollar is usually supportive for commodities priced in the currency.

"Oil, having taken little notice of the US Dollar for most of the last week or so, decided the world's marker currency's demise ought to be important, and of course it is now latterly added to reasons to be bullish. Which is why, and barring any more headlines of failing Russian infrastructure, oil and every other market's eyes will be on the FOMC (Federal Open Market Committee) decision on US interest rates later. A 25-point basis cut is more than 'baked in', it could be argued that the state of the US Dollar at present has at least another four cuts already factored," PVM Oil Associates noted.

In its weekly survey, the Energy Information Administration said U.S. commercial oil inventories fell by 9.3-million barrels last week, well above the consensus estimate among analysts polled by Reuters for a drop of 0.86 million barrels, on higher exports and a drop in imports.

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