Crude oil contracts closed flat at the end of New York trading after a nascent rally was cut short by the American Petroleum Institute’s (API) Crude Inventory data. Although crude inventories fell by a pleasing 3.6 million barrels, gasoline inventories rose by a surprising 1.4 million barrels, not a good sign during the U.S. summer driving season.
Attention now turns to this evenings official Energy Information Administration’s (EIA) inventory data, with the street looking for drawdowns in crude and gasoline stocks of -3.1 million and -0.5 million barrels respectively. The data will more than likely decide the fate of crude prices this week with a lower than expected drawdown leading to deeper corrections in both Brent and WTI.
Brent spot trades unchanged this morning at 51.55 in directionless trading. Brent’s pricing remains the more constructive of the two contracts due to the backwardation in the front end of the futures curve. But overall, it continues to range trade in a broad 49.70 to 52.70 band, albeit with choppy intra-day price action.
WTI spot also trades unchanged at 47.50 hovering just below its 100-day average at 47.70. Key support comes in at 46.40 with the double top at 48.70 formidable resistance for now.