The Energy Information Administration reported a sharp drawdown of 11.5 million barrels in US crude stocks last week to a total of 420.9 million barrels, whlile analysts only expected a drop of 1.6 million barrels. 

Gasoline stocks fell by 0.2 million barrels to 230 million barrels, while distillate stocks rose 0.5 million barrels to 109.4 million barrels. 

US stock indices rose on Wednesday ahead of the Federal Reserve’s policy decision later today.

US unemployment claims fell 5 thousand last week to 245 housand as expected by analysts. 

Later today, the Fed will announce its policy decision, widely expected to hold interest rates unchanged while releasing new forecasts for unemployment, inflation, and interest rates this year.

Markets are also analyzing the developing conflict between Iran and Israel and mutual threats, with US President Trump threatening to intervene. 

On trading, Dow Jones rose 0.7% as of 15:44 GMT, or 280 points o 42,500 points, while S&P 500 rose 0.6%, or 34 points to 6017 points, as NASDAQ added 0.7%, or 133 points to 19,657 points. 

Bitcoin lost modest ground on Wednesday but still traded near $105,000 following a 2% drop yesterday.

It comes as traders await the Federal Reserve’s policy decisions later today, which could hurt high-risk assets such as bitcoin.

Concerns were allayed in the markets as investors shrug off President Trump’s threats to enter the conflict against Iran.

Focus on Fed

Traders are now focused on the Federal Reserve’s policy decisions later today, expected to hold rates unchanged at below 4.5%.

The Fed will provide its forecasts for US growth, inflation, and interest rates this year, crucial for influencing the market’s future outlook.

Bitcoin hit $103,371 on Tuesday amid the Middle Easter tensions, which entered its sixth day with news about a potential US entry.

Escalation at any point remains possible and could shake the markets if Trump went ahead with a threat to strike Iranian positions.

Positive Signs

Despite the geopolitical concerns, there were positive legal signals, with the US Senate passing the GENIUS bill regulating Stablecoins, in wait for a similar approval by the House then the President.

It’s an important achievement for the crypto industry and puts a legal framework for their operations, boosting their credibility. 

Trump Media Seeks Launch of Crypto ETFs

The Trump Media & Technology Group sent a request to the SEC to launch new bitcoin and ethereum ETFs according to a new filing. 

This is the second such request of the Trump group, and will join a jam packed market for such ETFs in the US in recent months. 

Otherwise, recent Faraside Investors data showed investments into bitcoin ETFs surged to $408.6 million on Monday, the second highest this month.

Oil prices were little changed on Wednesday after a 4% surge in the previous session as markets assess the possibilities of supply disruptions due to the Iran-Israel conflict, with questions about a possible entry by the US.

US crude futures rose 0.2% to $76.61 a barrel as of 10:58 GMT, while US West Texas futures added 0.2% to $75.01 a barrel, after a 1% drop earlier in the session.

Trump Threatens 

US President Trump warned that America’ patience is running out, and called for Iran’s unconditional surrender.

Trump earlier said the US won’t kill Khamenei for the time being but his remarks continued to grow more aggressive every day.

Analysts worry that a US entry into the fray would widen the scope of the conflict and threaten the region’s energy infrastructure. 

The possibility of the closure of the Hormuz strait in particular is of a huge concern to many investors and could send oil prices to over $120 a barrel according to some analysts.

Iran is currently OPEC’s third biggest oil producer at 3.3 million bpd.

Will the Crisis Push the Fed to Cut Rates?

Now markets await the Federal Reserve’s policy decisions later today, expected to maintain rates unchanged at below 4.5%.

But global tensions and concerns about growth could prompt the Fed to cut rates by 25 basis points in July, faster than the September timeline expected by analysts. 

Inventory Drawdown

Initial data from the American Petroleum Institute showed US crude stocks fell by 10.1 million barrels in the week ending June 13, with official EIA data scheduled later today.