WTI sees 2% relief rally, near $ 54.50 ahead of EIA data

• Reverses losses after Tuesday’s 6% slump led by broader market sell-off.
• Looks vulnerable amid global growth concerns, as focus shifts to EIA crude stockpiles data.

WTI (oil futures on NYMEX) extends its recovery above the 54 handle, having almost reversed a third of yesterday’s 6% sell-off, as a recovery in the risk-appetite combined with an unexpected draw in the American Petroleum Institute (API) crude inventories and record Indian crude imports lifted the sentiment around oil.

The API reported late-Tuesday that the US commercial crude inventories last week fell unexpectedly by 1.5 million barrels, to 439.2 million, in the week to November 16. Meanwhile, The world’s no. 3 oil consumer, India’s, crude oil imports rose to the highest level in at least 7 years.

Further, a fresh selling in the US dollar versus its main peers amid risk-on also collaborated to the relief rally in the USD-denominated oil.  However, it remains to be seen if the black gold can sustain the bounce amid looming concerns over the global economic prospects, with the OECD lowering its 2019 global growth forecasts to 1.1% from 1.4% previous, in the wake of rising financial and trade risks.

Looking ahead, the barrel of WTI will take fresh trading direction from the US EIA crude inventories and supplies report due at 1530 GMT.

WTI Technical Levels