- WTI remains under some selling pressure for the second straight day on Thursday.
- A spike in US inventories overshadows geopolitical risks and weighs on Oil prices.
- The OPEC sees a rise in global demand in 2024, 2025, albeit fails to lend support.
West Texas Intermediate (WTI) US Crude Oil prices extend the overnight pullback from the vicinity of mid-$78.00s, or a fresh monthly peak and drift lower for the second successive day on Thursday. The commodity hovers around the $76.00 mark during the Asian session and remains well within the striking distance of the weekly low touched on Monday.
The larger-than-expected build in US Crude Oil inventories, to a larger extent, overshadows a combination of factors and exerts some pressure on the black liquid. The Energy Information Administration (EIA) said on Tuesday that US inventories rose by roughly 12 million barrels in the week ended February 9, well above market expectations amid a drop in refinery utilization to its lowest levels since December 2022.
Meanwhile, a monthly report from the Organization of the Petroleum Exporting Countries (OPEC), indicating that global Oil demand will rise by 2.25 million bpd in 2024 and by 1.85 million bpd in 2025, does little to impress bullish traders. Moreover, a fresh escalation of tension in the Middle East, which could disrupt supply from the oil-rich region, also fails to lend support to Crude Oil prices, favouring bearish traders.
In the latest development, Israel launched airstrikes in Lebanon in retaliation to a rocket fired into Northern Israel. This comes after Israeli Prime Minister Benjamin Netanyahu defied ceasefire calls from the international community and called a powerful operation in Rafa, raising the risk of a further escalation of military action in the region. The lack of buying interest, however, supports prospects for additional losses for Oil prices.
Market participants now look to the US economic docket, featuring the release of the Empire State Manufacturing Index, monthly Retail Sales figures, the Philly Fed Manufacturing Index and the usual Weekly Initial Jobless Claims. The data might influence the US Dollar (USD) price dynamics later during the early North American session and allow traders to grab short-term opportunities around Crude Oil prices.
Technical levels to watch
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