Oil Pushes Above the 50 Daily SMA, After Huge Drawdown in EIA Crude Inventories
Crude Oil had been bearish for since the second week of this month started, reversing below $94 and falling to $73.50s by Monday this week. The failure of China to reopen from the coronavirus lockdowns hurt the sentiment for Oil, but on Monday we saw a reversal and US WTI crude climbed above $81 earlier today.
One of the reasons for this move has been the protests in China, which have led traders to think that there will be some kind of relaxation/reopening soon, and yesterday there were some positive comments, although everything is still unclear. Today, the US EIA crude Oil inventories posted a major drawdown which gave Oil another push higher.
WTI Crude Oil H4 Chart – Trading Above $80 Today
USD strength is hampering the bullish momentum a bit
US energy inventory data
- EIA weekly US oil inventories -12,580K vs -2758K expected
- Prior was -3691K
- Gasoline +2769K vs +1625K expected
- Distillates +3547K vs 1457K expected
- SPR draw of 1.4m barrels
- Refinery utilization +1.3% vs +0.2% exp
There was a huge draw but it was foreshadowed somewhat by the 7m draw in the API data from late yesterday. Oil made some gains on the headlines but it’s not back to the session highs as it fights a rising USD on the tape. Refineries are running ultra-hard right now, near seasonal records as crack spreads make for a windfall.
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