WTI surges toward mid-$74 in post-settlement trade as API shows large draw in crude stocks
- API's weekly report shows U.S. crude oil stocks fell 6.8 million barrels.
- EIA's report shows a higher oil demand in the U.S. in 2019.
After settling with small gains at $74.11, the barrel of West Texas Intermediate gained traction in the late NA session after the weekly API report showed a larger-than-expected draw in crude oil stocks in the United States. As of writing, the barrel of WTI was trading at $74.40, adding 50 cents, or 0.7%, on the day.
The American Petroleum Institute announced that crude inventories dropped by 6.8 million barrels in the week ending July 6 vs. Reuters' estimate for a decrease of 4.5 million barrels. Further details of the report revealed that refinery crude runs fell by 118,000 barrels per day and gasoline stocks decreased 1.6 million barrels.
Earlier today, the Energy Information Administration released its short-term energy outlook report, which highlighted that the WTI was forecasted to average $67 in the second half of the year and $62 in 2019. Furthermore, the EIA also revised its expectation of the U.S. Oil demand growth to 330,000 barrel per day in 2019 compared to 260,000 bpd in the previous report.
Nevertheless, investors seem to be focused on the supply disruptions and Iran sanctions. On Tuesday, Mehr News Agency reported that Iran's oil exports were estimated to drop by 500k bpd with the restart of the U.S. sanctions in August and fall even further in November when the second wave of sanctions go into effect.
Technical outlook: Crude Oil WTI Technical Analysis: Risky bull trap