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Crude oil futures higher on firming fundamentals, US inventory draw - S&P Global

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0230 GMT: Crude oil futures were higher during mid-morning trade in Asia trade Sept. 22 amid firming fundamentals and a draw in US crude stocks.

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At 10:30 am Singapore time (0230 GMT), the ICE November Brent futures contract was up 50 cents/b (0.67%) from the previous close at $74.86/b, while the NYMEX November light sweet crude contract was 59 cents/b (0.84%) higher at $71.08/b.

"Crude oil prices pared losses as the risk-off tone of the market subsided and the focus shifted back to strong fundamentals," ANZ research analysts said in a Sept. 22 note, adding sentiment had received a further boost from the US repealing a ban on foreign travelers, which could add more than 190,000 b/d of jet fuel demand in November.

Highlighting tight supply as demand improves, US oil producers were still working to bring back production stalled by Hurricane Ida three weeks ago.

The US Bureau of Safety and Environmental Enforcement reported Sept. 21 that around 320,909 b/d or 16.64% of the Gulf's oil production remains offline, while about 566.67 MMcf/d or 25.42% of gas production remains shut.

Despite the proportion of offline production easing, supply is still expected to remain tight after Shell reported that full recovery in the Gulf looks unlikely in the near term as damage to its facilities will push the resumption of full capacity in the region to the first quarter of 2022.

The dollar was also seen volatile as the Federal Reserve's Open Market Committee began a two-day meeting that is widely expected to end in the US central bank pursuing a more hawkish monetary policy.

"After hitting a resistance level at 93.45 this week, the US dollar index continues to consolidate as traders are largely on hold for the Fed meeting today," IG Market Strategist Yeap Jun Rong said Sept. 22.

The US Dollar Index edged down to 93.19 in mid-morning trading in Asia from the Sept. 21 close at 93.20.

The American Petroleum Institute reported late Sept. 21 that US crude stocks fell 6.11 million barrels in the week ended Sept. 17, after reporting a 5.4 million-barrel draw the week before, outpacing analyst expectations of a 2.4 million-barrel draw. US gasoline inventories fell 432,000 barrels in the week, while distillate stocks fell 2.72 million barrels, the API said.

The market will now look to the US Energy Information Administration's stocks report due for release later Sept. 22 for further pricing cues.

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