- Risk-off remains at full steam on escalating US-China trade concerns.
- Swelling US crude inventories and bearish technical set up adds to the downside.
- Will the US EIA crude stocks report rescue the oil bulls?
WTI (futures on Nymex) extended losses in the European session and breached the 52 support area to print fresh four-day trough just below the 51.50 level. At the press time, the black gold is seen making minor-recovery attempts and trades near 51.75 region, still down 3% on the day.
The sell-off in the barrel of WTI extended last hours, with the rates witnessing a sharp drop below the 52 handle, as a renewed risk-aversion gripped the European markets amid intensifying US-China trade tensions. The latest tough stance adopted by the US Administration on China continued to cast clouds on a potential trade deal between both the countries.
Moreover, the black gold remains under pressure after the EIA slashed the global demand growth forecast a day before while the Chinese crude oil imports fell sharply in May. The EIA lowered its 2019 world oil demand growth forecast by 160,000 barrels per day (bpd) to 1.22 million bpd.
Further, an unexpected rise in the US crude stockpiles exacerbated the pain in the US oil. The latest US API data showed that the US crude inventories rose by 4.9 million barrels in the week ended June 7 to 482.8 million barrels when compared with expectations for a decrease of 481,000 barrels.
All eyes now remain on the official US government weekly crude stockpiles data due to be published by the EIA later today at 1430 GMT for the next direction on the prices.
WTI Technical Levels
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