Oil update: Volatility around inventory data
|Crude's maligned meander lower still finds buyers on dips, likely a function of pre-China PMI/NPC positioning, but the grind higher gap lower trend could extend until US inventories drop. So we should expect volatility around US inventory data releases.
The market has underestimated Russian production, SPR-driven exports and various dark fleets that sess global inventories remain higher than expected.
Since China is the most persistent driver for the outlook, we could be nearing a short-term make-or-break moment for Oil prices. If China's PMI fails to inspire or during the NPC policymakers were to maintain the status quo, i.e. a marginal increase in fiscal stimuli, oil traders would likely remain cautious about China's recovery. As a result, Oil prices would likely continue to underperform and could be at the mercy of the USD outlook (Hawkish Fed.)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.