WTI extends its downside below $82.50 on crude inventory build
Trending Articles- Gold slumps below $4,800 on renewed Strait of Hormuz tensions
- How Will the U.S.-Iran Situation Evolve? What Is Behind the Nasdaq’s Record High?
- Gold holds steady above $4,800 amid US-Iran ceasefire uncertainty
- JPMorgan Raises S&P 500 Target; Can AI Sector Continue to Drive US Stocks?
- Australian Dollar receives support after Trump extends ceasefire with Iran
- WTI drifts higher to near $89.00 amid Lebanon-Israel ceasefire strains
■WTI trades in negative territory for the third consecutive day near $82.25 on Thursday.
■A rise in US crude inventory and a higher possibility of delay rate cuts from the Fed drag the black gold lower.
■Oil traders will monitor the development surrounding Middle East geopolitical tensions.
Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $82.25 on Thursday. The black gold edges lower on the day due to a rise in US crude inventory and the expectation of delay rate cuts from the Federal Reserve (Fed). However, the escalating geopolitical tensions in the Middle East might limit the black gold’s downside.
US crude oil stocks rose for a fourth straight week. Crude oil stockpiles in the United States for the week ending April 12 rose by 2.735 million barrels from a build of 5.841 million barrels in the previous week. The market consensus estimated that stocks would increase by 1.6 million barrels, according to the Energy Information Administration on Wednesday.
Furthermore, several Fed officials delivered hawkish comments, which provided support to the US Dollar (USD) and dragged the USD-denominated WTI prices lower. Late Wednesday, Fed Cleveland President Loretta Mester said that inflation is higher than expected and the central bank needs more confidence in its trajectory. Meanwhile, Fed Chair Jerome Powell emphasized that he will wait longer than previously expected to cut rates after unexpectedly upside inflation data, adding that the US central bank will likely take more time to gain confidence that inflation is headed toward the Fed’s 2% target before lowering borrowing costs.
The risk of escalation in the Middle East appears to be limited for the time being. However, oil traders will keep an eye on Israel, and their response, especially after US President Joe Biden urged restraint and after Iran said they do not intend to continue strikes. Wider conflict in the Middle East might disrupt the oil supply and lift WTI prices.
Read more
* The content presented above, whether from a third party or not, is considered as general advice only. This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.
