WTI slips toward $57 as API reports surprise increase in crude stocks
- WTI clings to $57.30 at the start of Asian trading on Thursday.
- The Crude benchmark weakened recently on API stock data.
- The official EIA inventory release will be crucial for the energy traders going forward.
WTI trades around $57.30 during early Asian trading on Thursday. The barrel of West Texas Intermediate dropped to near $57.20 levels after the American Petroleum Institute (API) released its weekly crude oil stock data. Next up in the oil traders’ radar will be the official reading of the US stock change from the Energy Information Administration (EIA), up for 16:00 GMT today.
The weekly release of API crude oil stock surprised marked with an increase to 1.260M versus -0.998M drawdown registered last-week. The data renewed supply-glut fears amongst energy traders.
Following a weak start to the day due to industry stock report, investors may now concentrate on the official inventory levels up for later today.
As per the Reuters report, “U.S. crude stockpiles were expected to have risen by 3.1 million barrels last week, the fifth consecutive weekly build. Inventories at Cushing, Oklahoma, the main U.S. oil storage hub, will grow largely because U.S. data shows refinery capacity utilization in the Midwest dropped to 84.2 percent from 92.9 percent the previous week, following a string of planned and unplanned outages.”
In addition to stock data, the arrival of China’s Vice Premier Liu He to Washington in order to discuss future trade ties with the US diplomats will also be a key event for the crude. The reason being China is in the top-list of world’s largest crude consumers and its trade spat with the US has so far challenged the global growth.
While EIA is likely to follow the API’s footsteps, WTI might not refrain from declining further. Though, any positive news from the US-China trade front can help the energy traders ignore supply-glut threats for the time being.
WTI Technical Analysis
Considering an immediate downward sloping trend-line and API data, $57.00 and $56.85 seem nearby supports for the WTI benchmark, a break of which can recall $56.50 & $56.30 on the chart.
Alternatively, an upside clearance of $57.40 can propel the quote again towards $57.65 and then to $58.00 whereas $58.20 and $58.50 are likely following numbers that can please buyers.