- Sold-off into US-China trade woes-led risk-off, swelling US crude inventories.
- Technical set up points to negative bias, as oil prices hold below 200-DMA.
- Eyes US EIA crude stocks data and trade developments for the next direction.
The downward spiral in WTI (futures on Nymex) accelerated in early Europe, sending the prices nearly 2% lower to test the 52.00 support zone.
The bears extended control and sold-off the higher-yielding oil amid escalating US-China trade tensions, as markets remain wary over a trade deal likely to be reached when both countries’ leaders meeting later this month at the G20 Summit in Japan.
Moreover, the global demand growth forecast downgrade by the EIA combined with an unexpected rise in the US crude stockpiles also keeps the bearish grip intact around the black gold.
The EIA lowered its 2019 world oil demand growth forecast by 160,000 barrels per day (bpd) to 1.22 million bpd. Meanwhile, the 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.
Further, the barrel of WTI continues to remain below the 200 – SMA on the daily sticks, suggesting that the risks remain exposed to the downside. Markets now await the US EIA weekly crude stockpiles report due to be published later today at 1430 GMT for fresh trading opportunities.
WTI Technical Levels
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