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  • Crude oil prices are posting strong gains on Wednesday.
  • EIA reported that crude oil stocks last week declined by 4.5 million barrels.
  • OPEC in its monthly report said world oil demand is seen declining by 9.06 million bpd.

Crude oil capitalized on the upbeat market mood on Wednesday and rose sharply. Although the OPEC’s monthly report limited oil’s gains in the early American session, the US Energy Information Administration’s (EIA) weekly data provided an additional boost. As of writing, the barrel of West Texas Intermediate (WTI) was up 2% on a daily basis at $42.44.

WTI stretches higher despite OPEC’s dismal demand outlook

Earlier in the day, the OPEC said that it expects the global oil demand to decline by 9.06 million barrels per day (bpd) in 2020. This figures followed the expectation for a fall of 8.95 million bpd in the previous report. “Oil prices in the second half of 2020 will continue to be impacted by concerns over a second wave of coronavirus infections and higher global inventories,” the publication further read.

On the other hand, the EIA announced that crude oil stocks in the US declined by 4.5 million barrels in the week ending August 7th, compared to analysts estimate for a draw of 3.2 million barrels. This data helped the WTI gain traction in the last hours.

On Friday, Industrial Production and Retail Sales data from China, second-quarter GDP report from the euro area and Retail Sales and Industrial Production data from the US will be watched closely by the market participants. Additionally, the Baker Hughes Energy Services’ US Oil Rig Count will be looked upon for fresh catalysts.

Technical levels to watch for