- API reports a higher-than-expected draw in US crude inventories.
- WTI gains traction on data and rises toward $69.
The barrel of West Texas Intermediate staged a decisive recovery on Tuesday and tested the $69 mark before settling for the day near mid-$68s. However, the weekly API report released in the late NA session provided an additional lift in the post-settlement trade and the barrel of WTI was last seen up 93 cents, or 1.4%, on the day at $68.72.
The data released by the American Petroleum Institute on Tuesday showed that crude inventories in the U.S. decreased by 3.2 million barrels in the week ending July 20 to 407.6 million to surpass the Reuters’ expectation of a fall of 2.3 million barrels. Further details of the report revealed that crude imports fell by 249,000 barrels per day to 8.3 million bpd last week in the U.S. Investors will be watching tomorrow’s weekly EIA report to get some fresh information about the current state of oil production in the U.S.
The primary driver of the oil’s price action, however, seems to be the heightened expectations of Chinese staying robust despite the potential negative impacts of Trump administration’s trade tariffs. Earlier today, media reports claimed that China was looking to ramp up its infrastructure spending in order to keep the economic growth going at its solid pace.
Commenting on this development, “that’s going to be very bullish for oil demand Infrastructure spending from China in the past had really jacked up oil demand, and I think that’s adding some outside support for prices,” Phil Flynn, analyst at Price Futures Group in Chicago, told Reuters.
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