http://economictimes.indiatimes.com/markets/commodities/Oil-at-6-mth-highs-ahead-of-Fed-inventoriesdown/articleshow/6866330.

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LONDON: Oil climbed to a six-month high above $85 for a second straight session on Wednesday after U.S. fuel inventories fell, and ahead of the widely anticipated U.S. Federal Reserve's quantitative easing announcement due later. By 1155 GMT, U.S. crude for December rose $1.02 to $84.92 a barrel, after touching fresh six-month-highs of $85.04 earlier on Wednesday. ICE Brent rose $1.10 to $86.51 a barrel. Expectations the Federal Reserve will announce a fresh round of monetary stimulus at 1815 GMT kept the dollar under pressure, helping commodity prices, while world stocks rose to fresh two-year highs. Some analysts expect the Fed's announcement of further treasury bond purchases, also known as quantitative easing, to have a limited impact on markets that have already largely priced it in. "From a risk point of view, the risks are rather skewered to disappointment, and could limit the upside in oil prices today," Commerzbank oil analyst Carsten Fritsch said. "The odds are that prices will ease after the Fed announcement unless there is a big purchasing plan unveiled, as the bar is quite high for expectations in the market." Most leading economists expect the Federal Reserve to buy between $80 bn and $100 bn worth of assets per month, according to a Reuters poll. "It could be a typical case of buy rumour sell the fact," Credit Agricole CIB's global oil analyst Christophe Barret said. "It's very possible you will have some sell off in prices." BNP Paribas head of commodity markets strategy Harry Tchilinguirian said: "We also remain circumspect as to how much more price mileage oil will get from the announcement of a second round of quantitative easing in the short term." INVENTORIES Price support came from American Petroleum Institute (API) data on Tuesday showing a fall in U.S. crude inventories of 4.1 million barrels last week, compared with expectations for a 1.2 million barrel build.

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The Energy Information Administration (EIA) will publish official statistics later on Wednesday. Oil prices at $100 a barrel would be more comfortable for producing nations because of higher food prices and a weaker dollar, the top oil official for OPEC member Libya said on Tuesday. The Libyan comments came a day after Saudi Arabian Oil Minister Ali al-Naimi said oil in a $70-$90 range was comfortable for consumers, signalling a higher acceptable range from the $70-$80 range previously deemed comfortable.