Crude Oil Bounces $2 Off MAs As EIA Inventories Draw

In June, Oil prices surged but are declining this month. However, MAs are holding steady, and the draw in EIA inventory has helped bounce $2

Written by: Skerdian Meta • Wednesday, July 17, 2024 • 1 min read

Last updated: Wednesday, July 17, 2024

In June, oil prices surged significantly but have since declined this month. However, moving averages are holding steady, and the decrease in EIA inventory has helped halt the fall, resulting in a $2 increase in WTI crude oil today. WTI saw an increase of more than $10 last month, peaking at $84, but reversed direction in the first half of July, falling below $80 and hitting lows of $79. Today’s market movement suggests that the trend remains optimistic, with moving averages providing price support.

EIA inventories showed a huge drawdown for the week

Factors Influencing Oil Prices

Crude oil prices rose by $12 in June, driven by anticipated summer fuel consumption spikes and escalating tensions in the Middle East. However, weaker-than-expected demand growth in Asia, particularly China, the world’s top oil importer, has slowed price hikes. Official figures indicate that China experienced its slowest economic growth since early 2023 in the second quarter, expanding by only 4.7%.

WTI Oil Chart Daily – The 100 SMA Is Acting As Support

This sluggish growth rate is reducing global oil demand. At the same time, the strength of the U.S. dollar, evidenced by its steady rise over the past three sessions, has made oil more expensive for holders of other currencies, negatively impacting oil prices. However, concerns about potential supply disruptions due to increasing tensions in the Middle East, coupled with the draw in EIA inventories and technical analysis, have contributed to today’s price rebound.

Weekly EIA Crude Oil Inventory Report

Crude oil draw: -4.870M (vs. expected draw of -0.033M)
Gasoline inventories build: 3.328M (vs. expected draw of -1.600M)
Distillates build: 3.454M (vs. expected draw of -0.833M)
Cushing drawdown: -0.875M (vs. last week’s -0.702M draw)
Refining utilization: -1.7% (vs. expected -0.1%; previous +1.9%)

US WTI Crude Oil Live Chart

WTI

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.