09:09 AM EDT, 06/13/2024 (MT Newswires) -- Oil prices weakened early on Thursday after the Federal Reserve lowered expectations for a near-term rate cut and supply remains ample amid moderate demand.

West Texas Intermediate crude for July delivery, the U.S. benchmark, was last seen down US$0.33 to US$78.17 per barrel, while August Brent crude was down US$0.23 to US$82.37.

The Federal Reserve's policy committee ended its two-day meeting on Wednesday leaving interest unchanged, while its dot-plot forecast predicted just one cut to interest rates this year as Fed Chair Jerome Powell said the central bank will wait for further data showing inflation is moving towards the bank's 2% target before lowering rates.

The dollar rose following the Fed's decision, bearish for oil that is priced in the currency.

"After the US central bank left interest rate untouched and the median rate-setter has only foreseen one cut in the cost of borrowing this year pragmatism prevailed, risk assets retreated, and sentiment soured somewhat. In the Fed's view this is the price that needs to be paid to achieve a soft landing and avoid recession beyond doubt," PVM Oil Associates said in a post.

The Energy Information Administration on Thursday reported U.S. oil inventories rose by 3.7-million barrels last week, while the consensus estimate expected inventories to fall. Gasoline and distillate inventories also rose, showing weak demand during what is supposed to be the high-demand U.S. summer driving season.