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  • API data shows larger-than-expected draw in US crude oil stocks.
  • China announces fresh stimulus to revive economic growth.
  • Coming up on Friday: EIA’s weekly crude oil inventory report. 

Crude oil prices continued to push higher toward the end of the year and the barrel of West Texas Intermediate reached its highest level in more than three months at $62.31 on December 30th. Although profit-taking weighed on the WTI and caused it to post small daily losses on December 31st, it still closed the month 11.1% higher.

Steady start to 2020

At the start of the new year, the WTI edged lower but was able to limit its losses supported by the heightened hopes of global economic recovery gathering momentum and the weekly report published by the American Petroleum Institue, which showed late Tuesday that crude oil stockpiles in the US fell by 7.8 million barrels in the week ended December 27th. As of writing, the WTI was down 0.4% on a daily basis at $61.28.

At the start of 2020, the People’s Bank of China (PBoC) has announced a 50 basis point cut to its Reserve Requirement Ratio (RRR). Commenting on this move, “The PBoC estimates that the cut will inject around USD 115bn of liquidity into the financial system,” noted Rabobank analysts. “The move reflects a strong commitment of the central bank to support the economy.”

On Friday, the Energy Information Administration will release its weekly crude oil market report.

Technical levels to watch for