American West Petroleum Intermediate and international benchmark Brent crude oil futures are declining on Wednesday as renewed concerns over-improved demand in Europe, a weekly list from the American Petroleum Institute (API) report said That US crude inventories fell unexpectedly last week.
Traders now await the report of the weekly inventions from the US Energy Information Administration (EIA) at 14:30 GMT. It is expected to show a 2.8 million barrel build. An unexpected draw will likely elicit a response similar to API data from merchants, however, a larger-than-expected build is likely to extend the loss.
European COVID-19 concern over demand
According to Reuters, many European countries have stopped the use of AstraZeneca’s COVID-19 vaccine due to concerns over potential side effects. German is witnessing rising coronavirus cases, while Italy is imposing a nationwide Easter lockdown.
Stephen Brannock of PVM, an oil broker, said, “Suspension will not do any favours financially and fuel recovery.” “The hope now is that Europe may be able to put its sluggish vaccine rollout back on track.”
International Energy Agency issued a warning
The IEA stated that a supercycle was unlikely, demand would not return to pre-epidemic levels until 2023 and could reach peak levels earlier than previously thought. Statements of a possible recession helped pressure prices.
American Petroleum Institute Weekly Storage Report
The API reported on Tuesday a surprise of 1 million barrels of crude oil inventions for the weekend of March 12. Analysts were predicted to make a list of 2.964 million barrels for the week.
The API reported a drop in gasoline inventions to 926,000 barrels for the week ended March 12, topping the previous week’s 8.499 million barrels per week. Analysts had expected a 2.996 million barrel draw for the week.
Inventories saw an increase of 904,000 barrels in inventions this week, following the previous week’s decrease of 4.796 million barrels.
According to the EIA, US oil production rose 900,000 BPD million barrels per day to 10.9 million BPD.
The EIA weekly inventions report showed a buildup of 2.4 million barrels of crude oil, slightly less than the 2.8 million barrels forecast. This moderately rapid news may not be enough to address renewed concerns over European demand.
Our short-term forecast calls for WTI crude to change its trend at a move through $ 63.10. The next possible negative target area is $ 63.44 to $ 62.41.