Oil prices drift lower as soft U.S. fuel demand offsets persistent supply concerns

[Data analyzing in commodities energy market: the charts and quotes on display. US WTI crude oil price analysis. Stunning price drop for the last 20 years.]
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Crude oil futures added to losses as traders shifted focus from rate-cut enthusiasm to demand concerns, worried about the U.S. economic outlook a day after the Federal Reserve reduced interest rates for the first time this year.

The U.S. government reported single-family home building plunged to its lowest in nearly two-and-a-half years in August due to a glut of unsold new houses.

Meanwhile, crude oil inventories fell by 9.3M barrels last week, driven a massive drop in net crude imports, while distillate fuel stocks jumped by 4M barrels and were 8% below the five-year average for the time of year, raising concerns over the U.S. demand outlook.

The market has been waiting to see what additional sanctions the European Union might impose on Russia, but the large U.S. crude inventory draw, the Fed's rate cut, and ongoing concerns about higher OPEC+ production have "helped to keep the losses in check," ING strategists Ewa Manthey and Warren Patterson said in a note.

Front-month Nymex crude (CL1:COM [https://seekingalpha.com/symbol/CL1:COM]) for October delivery finished -0.7% to $63.57/bbl, and front-month Brent crude (CO1:COM [https://seekingalpha.com/symbol/CO1:COM]) for November delivery also setled -0.7% to $67.44/bbl.

Front-month Nymex October natural gas (NG1:COM [https://seekingalpha.com/symbol/NG1:COM]) closed -5.2% to $2.939/MMBtu, its largest one-day dollar and percentage decline since July 23, after the Energy Information Administration reported an above-consensus 90B cf increase in underground storage, extending the inventory surplus over the five-year average to more than 200B cf.

ETFs: (NYSEARCA:USO [https://seekingalpha.com/symbol/USO]), (BNO [https://seekingalpha.com/symbol/BNO]), (NYSEARCA:UCO [https://seekingalpha.com/symbol/UCO]), (SCO [https://seekingalpha.com/symbol/SCO]), (USL [https://seekingalpha.com/symbol/USL]), (DBO [https://seekingalpha.com/symbol/DBO]), (DRIP [https://seekingalpha.com/symbol/DRIP]), (GUSH [https://seekingalpha.com/symbol/GUSH]), (USOI [https://seekingalpha.com/symbol/USOI]), (UNG [https://seekingalpha.com/symbol/UNG]), (BOIL [https://seekingalpha.com/symbol/BOIL]), (KOLD [https://seekingalpha.com/symbol/KOLD]), (UNL [https://seekingalpha.com/symbol/UNL]), (FCG [https://seekingalpha.com/symbol/FCG]), (NYSEARCA:XLE [https://seekingalpha.com/symbol/XLE])

MORE ON CRUDE OIL

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* September 2025 Commentary And Economic Outlook [https://seekingalpha.com/article/4823555-september-2025-commentary-economic-outlook]