$80 Within Reach in WTI Oil As Sentiment Improves
Yesterday, for the majority of the day, West Texas Intermediary (WTI) Oil bids were on the back foot as the US Dollar (USD) found strong bids across the board initially, but then the decline continued even as the USD turned bearish in the US session, lowering energy prices. Meanwhile, global economic data continues to disappoint, delaying market expectations for increased Crude Oil demand as growth in Europe and China continues to fall behind market estimates.
Crude Oil began October in a great way, but it ended down at the bottom almost where it started. Following the Middle East tensions, WTI Oil opened at $80 last month and climbed to $89.90 before failing to reach the key round mark of $90 and reversing significantly lower. yesterday the price fell below $81, so we are back where we started before the conflict in Gaza started.
On the daily chart, we can see that Crude Oil has erased all of the gains made since the outset of the Israel-Hamas war, indicating that the market is beginning to look beyond the conflict in the absence of a further escalation with Iran. The break below the major support at the $83 level is noteworthy, raising the possibility of a further decline into the $78 level, which contains the previous swing low. Yesterday the EIA crude Oil inventories were released and they pushed the price further down after showing yet another increase.
Weekly EIA Crude Oil Inventories Data
- EIA weekly crude inventories +774K vs +1261K expected
- Prior crude +1371K
- Gasoline +65K vs -803K expected
- Distillates -792K vs -1540K expected
- Refinery utilization -0.2% vs +0.4% expected
- Production estimate mbpd 13.2 vs 13.2 mbpd prior
- Impld mogas demand: 8.68 mbpd vs 8.94 mbpd prior
US WTI Crude Oil Live Chart
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