Fed cuts interest rates. More cuts to come?
September 18, 2025
The DOE inventory report had crude stocks down a big 9.29 million barrels, much more than expected. Comments on the market were that this could potentially be a data correction, and we will have to wait and see how things play out in the next few weeks. Gasoline supplies were down 2.35 million barrels and distillates were up 4.05 million barrels.
Total crude supplies are 415.361 million barrels. Last year, there were 417.513, and the three-year average is 422.248.
Total gasoline supplies are 217.650. Last year, there were 221.621, and the three-year average is 218.569.
Total distillates are now at 124.684. Last year, there were 125.148, and the three-year average is 120.688.
Propane supplies were up 1.297 million barrels, putting total supplies at 98.931 million barrels. Last year there were 99.107 and the 5-year average is 90.340.
Midwest stocks were down 268,000 barrels, putting total Midwest stocks at 26.056 and last year they were 26.973 and the 5-year average is 26.121.
Gulf Coast stocks were up 888,000 barrels putting total Gulf Coast stocks at 59.062 and last year they were 57.819 and the 5-year average is 50.262.
The FOMC lowered interest rates by 25 basis points with the Federal Fund overnight rate now at (4.00%, $4.25%). The Fed expects two more interest rate cuts this year.
August housing starts fell 8.5% from July. Building permits for future construction unexpectedly fell 3.7% to a more than 5 year low.
Ukraine’s focus on hitting Russian energy infrastructure is offering support to prices.
From JP Morgan, despite signals of stronger midyear US growth, our economists continue to assess near-term recession risks as elevated, holding at 40%.
Kremlin spokesman, Dmitry Peskov, said the European Union’s plan to phase out Russian energy and commodities more quickly will not affect Russia and will not force it to change its position.