- Finds support from lower US inventories, OPEC disagreement on output hike.
- Libyan supply disruption also underpins the black gold.
- Awaits fresh impetus from the EIA crude stockpiles data ahead of Friday’s OPEC meeting.
WTI (oil futures on NYMEX) is seen gaining recovery momentum last hour, but the bulls seek to the take-out the key $ 65.50 barrier convincingly for further upside.
The renewed uptick in oil prices can be mainly attributed to the division amongst the OPEC and non-OPEC producers on the output policy, with Saudi and Russia looking committed to ramping up production while Iran, Oman, Venezuela and Nigeria among others remain uncertain about their support for an output hike.
More so, waning concerns over the US-China trade dispute combined with a drawdown in the US crude inventories continue to lend support the barrel of WTI. The latest data from the American Petroleum Institute (API) showed the US crude inventories fell by 3 million barrels to 430.6 million barrels in the week to June 15.
Further, the loss of storage capacity in Libya also helps keep the sentiment buoyed around the black gold. Traders said a drop in Libyan supplies is due to the collapse of an estimated 400,000-barrel storage tank, as cited by Reuters.
The focus now remains on the US Government official crude stockpiles data due to be published by the Energy Information Administration (EIA) later on Wednesday for fresh momentum on the prices. However, the main event risk this week remains Friday’s meeting between the OPEC and its allies in Vienna on the output policy.
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