- Oil sold-off into US-China trade woes, rising OPEC output
- Stronger USD Index also adds to the downside in oil.
- Markets await API Crude Stocks data and trade-related news.
WTI (futures on Nymex) extends losses into a third straight day today and meanders near the lowest levels in five days just ahead of the 54 handle.
Trade concerns, Dollar dynamics to dominate
The black gold is seen reversing almost half the last week’s rally, as the sentiment continues to remain undermined by escalating US-China trade war that seen having a significant impact on the global economic growth. Markets, therefore, fret that the global economic slowdown could likely weaken the oil demand growth and eventually hurt the prices.
Moreover, persistent broad-based US dollar buying amid trade war fears-led risk-aversion also collaborates to the downbeat tone in the barrel of WTI. A stronger greenback makes the USD-denominated oil more expensive for holders in foreign currencies. The USD index sits near the highest levels seen since May 2017 at 99.35, up +0.40% so far.
Additionally, the prices remain weighed down by the latest report that the Organization of Petroleum Exporting Countries’ (OPEC) crude oil production rose in August for the first time since the start of 2019 output cutbacks. OPEC output rises for first time since start of 2019 cutbacks – Bloomberg Survey
Attention now turns towards the US weekly Crude Stocks data due later today for fresh direction on the prices. The American Petroleum Institute (API) will publish its data at 2030 GMT. Meanwhile, the Energy Information Administration’s (EIA) US crude inventory data will drop in on Thursday at 1430 GMT, in the wake of the US Labor Day holiday on Monday.
WTI Levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD challenges 1.0500 on Dollar's bounce
The US Dollar now picks up further pace and weighs on the risk-associated assets, sending EUR/USD to the boundaries of the key 1.0500 region and at shouting distance from its 2024 lows.
GBP/USD remains weak and puts 1.2600 to the test
GBP/USD remains on the back foot and now approaches the key support at 1.2600 the figure in response to the resurgence of the bid bias in the Greenback.
Gold faces extra upside near term
Gold extends its bullish momentum further above $2,660 on Thursday. XAU/USD rises for the fourth straight day, sponsored by geopolitical risks stemming from the worsening Russia-Ukraine war. Markets await comments from Fed policymakers.
BTC hits an all-time high above $97,850, inches away from the $100K mark
Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.
A new horizon: The economic outlook in a new leadership and policy era
The economic aftershocks of the COVID pandemic, which have dominated the economic landscape over the past few years, are steadily dissipating. These pandemic-induced economic effects are set to be largely supplanted by economic policy changes that are on the horizon in the United States.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.