Commodity Market: US Crude Oil slumps to one-week lows as inventories increase, virus spread heightens fuel demand concerns

Futures on US West Texas Intermediate Crude Oil extended losses from the prior two trading days and hit a one-week low on Thursday, after government data revealed a larger-than-anticipated increase in oil stocks, while rising new coronavirus cases added to concerns fuel demand recovery might slow.

WTI Crude plummeted more than 4.8% on Wednesday after the US Energy Information Administration (EIA) said crude oil stocks had increased by 1.442 million barrels during the week ended on June 19th, or far more than what analysts on average had expected – an increase by 0.299 million barrels. Yet, according to analysts, the inventory build was due to a flotilla of Saudi cargoes, which had been booked by US refiners when oil prices plunged three months ago.

Meanwhile, experts support the view fuel demand recovery may be obstructed by the rapid spread of the COVID-19 illness in Latin America, Russia and South Asia, as well as by rising new cases across the United States, including in areas where lockdown restrictions have been relaxed. AxiCorp market strategist Stephen Innes pointed out that, according to mobility data by Google, driving in states such as Texas, Florida and California was flatlining.

As of 9:20 GMT on Thursday, WTI Crude Oil Futures were retreating 0.70% to trade at $37.77 per barrel, after earlier falling as low as $37.16, or a price level not seen since June 18th ($37.13). WTI Crude futures have dropped 4.13% so far this week, following an 8.00% gain in the preceding week.

Brent Oil Futures were edging down 0.17% on the day to trade at $40.20 per barrel, after earlier slipping to $39.50, or a price level not seen since June 16th ($38.98). Brent futures have dropped 4.06% so far this week, following a 7.60% gain in the prior week.

Daily Pivot Levels (traditional method of calculation) – WTI Crude Oil Futures

Central Pivot – $38.63
R1 – $39.92
R2 – $41.82
R3 – $43.11
R4 – $44.41

S1 – $36.73
S2 – $35.44
S3 – $33.54
S4 – $31.65

Daily Pivot Levels (traditional method of calculation) – Brent Oil Futures

Central Pivot – $40.92
R1 – $42.21
R2 – $44.14
R3 – $45.43
R4 – $46.71

S1 – $38.99
S2 – $37.70
S3 – $35.77
S4 – $33.83

TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover Forex, Price Action and Social Trading.

Related News