WTI retraces daily upside, trades above $63 ahead of weekly API data

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  • OPEC+ refrains from making a decision on output ahead of June meeting.
  • Morgan Stanley expects oil market to be undersupplied around 1.1 mbd in Q3.
  • Coming up: Weekly API crude oil stock report.

After rising $0.5 on Monday, the barrel of West Texas Intermediate pushed higher during the first half of the day on Tuesday but lost its momentum before testing the $64 handle. As of writing, the WTI was virtually unchanged on a daily basis at $63.06.

According to Reuters, During the meeting in Jeddah on Sunday, OPEC+ decided not to recommend a course of action regarding the oil output and said wanted to continue to monitor the markets until the next meeting in June. However, Saudi Arabia’s Energy Minister Khalid al-Falih said that they were willing to “gently” drive down oil inventories and provided a modest boost to crude oil prices.

Meanwhile, Morgan Stanley in a recently published report said that it expected the oil market to be undersupplied by more than 1 million barrels per day in the third-quarter, reminding investors of the potential negative impact of the U.S. sanctions on Iran and the conflict in the Middle East on the oil market. Confirming that view, Iraq’s Oil Minister Jabar al-Luaibi noted that regional tensions continued to pose challenges to oil markets. 

Later in the session, the weekly API crude oil stocks will be looked upon for fresh impetus. 

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