WTI Oil Rebounds As Domestic Production Declines To 11.9 Million Bpd

Key Insights

• WTI oil managed to get back to the $89 level as U.S. domestic production declined from 12 million bpd to 11.9 million bpd. 
• Working gas in storage increased by 125 Bcf but natural gas managed to settle back above $6.55.
• Gold rebounded as the U.S. dollar found itself under material pressure. 

WTI Oil Gained Ground After EIA Report

WTI oil made an attempt to settle back above the $89 level after the release of the EIA Weekly Petroleum Status Report.

The report indicated that crude inventories increased by 9.9 million barrels from the previous week, compared to analyst consensus of 1.75 million barrels. Total motor gasoline inventories grew by 2 million barrels, while distillate fuel inventories declined by 4.9 million barrels.

Importantly, domestic oil production declined from 12 million bpd to 11.9 million bpd, which served a material positive catalyst for WTI oil.

Currently, WTI oil is trying to settle back above the 50 EMA, which is located near the $88.50 level. In case this attempt is successful, WTI oil will have a good chance to gain upside momentum and move towards the next resistance at $90.30.

Natural Gas Moved Back Above $6.55

Natural gas settled back above the $6.55 level after the release of the EIA Weekly Natural Gas Storage Report, which indicated that working gas in storage increased by 125 Bcf from the previous week.

Analysts expected that working gas in storage would grow by 123 Bcf, so the report was mostly in line with the analyst consensus. At this point, stocks are 221 Bcf below the five-year average for this time of the year.

Natural gas prices have found strong support in the $6.30 – $6.55 range, and the market will need significant negative catalysts to settle below the key support at $6.30.

Gold Rebounds As Dollar Pulls Back

Gold found support near the $1640 level and moved back above the resistance at $1660 as the U.S. dollar pulled back from recent highs.

While U.S. inflation reports exceeded analyst expectations, traders decided to take profits after the strong rally. As a result, the U.S. Dollar Index declined towards 112.40, which was bullish for gold.

Other precious metals have also rebounded after testing new lows. Silver failed to settle below $18.40 and moved towards the $19.00 level. Platinum rebounded towards $900, while palladium climbed back above $2100.

Copper Moved Away From Recent Lows

Copper remains stuck in the $3.40 – $3.45 range as traders wait for additional catalysts.

While other commodity markets were volatile, copper markets have lacked momentum in recent trading sessions.

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