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API reports surplus, while WTI awaits EIA report: call updated

WTI reversed gains of last week as Iranian officials denied rumors of cooperation and declined to confirm whether Iran would join next month’s informal OPEC meeting or not. WTI is currently trading at $47.6 per barrel and Brent at $2.1 per barrel premium to WTI.

Key factors at play in Crude market –

  • OPEC countries have announced an informal meeting in late September when on the sideline of IEA biennial summit in Algeria. However, Iranian officials have declined to comments on whether they will join or not.
  • A leaked email showed Saudi Arabia’s oil minister Khalid al-Falih talking about cooperation if needed. However, Iran has said that the production level desired is yet not reached.
  • Oil market glut has shifted from crude oil to gasoline.
  • Recent research by Rystand Energy has revised US crude reserve upwards to 264 billion barrels, more than Saudi Arabia and Russia.
  • U.S. oil production has dropped to 8.6 million barrels/day and likely to drop further. It has declined more than a million barrel from the peak but up from its low of 8.43 million barrels per day.
  • Active oil rigs in the US have been climbing and up more than 25 percent from its bottom.
  • American Petroleum Institute’s (API) weekly report showed massive increase in crude oil inventory by 4.464 million barrels. Gasoline inventory declined by 2.2 million barrels.

Today’s inventory report from US Energy Information Administration (EIA) will be released at 14:30 GMT.

Trade idea –

  • The key happenings surrounding OPEC and Saudi Arabia have boosted oil price along with a weaker dollar, however, as of now, there are no signs that the price would break above $52 resistance area.
  • Market Data
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