WTI sits at 2-week highs near $ 58.50 ahead of EIA data, Fed

• Oil benefits from falling US stockpiles, constructive US-China trade talks.
• Focus on EIA crude stocks data and FOMC decision for the next direction.

WTI (futures on Nymex) is seen consolidating the recent upmove to two-week highs of $ 58.58, as the bulls take a breather ahead of the key Energy Information Administration (EIA) crude stocks data and Fed’s rate cut announcement due later today.

Supply risks continue to lend support

The Fed rate cut led optimism continues to underpin the sentiment around the black gold, as the Fed’s easing would lift the fuel growth demand amid a likely boost in the global economic growth.

Further, rising supply threats, in the face of a massive draw in the US American Petroleum Institute (API) and slide in the Iranian exports this month, remain the main underlying factor

Moreover, the latest report by the Global Times, citing that the US-China trade teams had constructive and deep talks, helps keep the buoyant tone intact. A trade deal is likely to calm ease global growth fears and benefit risk assets such as oil.

The bulls now await the US EIA weekly crude stockpiles data and the FOMC outcome for the next push higher.

WTI Levels to watch