WTI picks up fresh bid, retests $ 58 mark ahead of API data
- Reports of drop in Russian oil output likely rescued the oil bulls.
- Firmer US dollar, US-China trade woes to keep the bounce
WTI (futures on Nymex) caught a fresh bid-wave and broke its overnight consolidative phase last hour, with the bulls having tested the 58 handle before reversing quickly to near 57.80 region, where it now wavers.
The latest report that the Russian oil output fell by more than 3% from the June average during July 1st to 8th appears to have put a bid under the black gold, as the prices popped up from 57.33 lows to reach the daily highs at 57.98.
However, a break above the 58 handle remains elusive amid unabated US dollar demand across the board, as markets price-out a bigger Fed rate cut on stronger US jobs report. A stronger US dollar makes the USD-denominated oil more expensive for foreign buyers.
Moreover, the investors remain edgy and refrain from placing big bets on the higher-yielding assets such as oil amid renewed US-China trade worries and South Korea-Japan row. Markets now eagerly await the American Petroleum Institute (API) crude stockpiles report due later today at 2030 GMT for the next direction in the barrel of WTI.
Markets now await the US weekly crude stockpiles data for the next direction on the prices. Meanwhile, the barrel of WTI will remain at the mercy of the risk sentiment influenced by the geopolitical tensions.
Levels to watch