Crude oil prices are mixed today - WTI is currently flat while Brent crude is slightly higher. Yesterday, the commodity sold off sharply following data from the American Petroleum Institute. While consensus estimates called for a slight increase in crude inventories (+0.85m), actual inventories grew by +5.32m. While gasoline and distillate stocks fell faster than expected (suggesting strong end-user demand), crude oil prices fell nonetheless. The announcement of a longer-term OPEC/Russia supply cut deal from Saudi Crown Prince Mohammed bin Salman also had a limited impact on the commodity. Official figures from the US EIA are due later today.
Looking at crude oil's newest Chinese benchmark, the commodity is currently trading between Brent and WTI prices. The first three days of trading have been fairly volatile, with a small number of outstanding contracts but with very high trading turnover. Our short-term outlook and medium-term outlook on crude oil is bullish.
WTI is currently trading above $64.60. Brent crude is currently above $69.70.
Looking at US crude oil stocks, the most recent EIA figures (March 21) showed falling crude oil stocks and falling gasoline inventories. Crude oil inventories were lower than estimates (-2.6m). Gasoline stocks were down (-1.7m) while distillate stocks (-2m) were also down. Looking at reactions in markets, crude oil prices strengthened following the EIA report.
As crude oil strengthens, we are upgrading the commodity to bullish. Note that both WTI and Brent are trading within normal conditions. This is based on technical indicators on the daily chart.
As crude oil rebounds, we are upgrading the commodity to bullish in the medium-term. Looking at various technical indicators on the weekly chart, note that both WTI and Brent are trading within normal conditions.