- Weighed down by souring risk appetite amid Italian budget woes, trade concerns.
- Focus remains on US EIA crude inventory report after bearish API data.
WTI (futures on Comex) broke its Asian consolidation phase to the downside and tested the 61 handle following a major turnaround in the risk sentiment in the European session.
The higher-yielding oil came under heavy selling amid a worsening mood, induced by the resurgence of the Italian budget woes and fading hopes of the US-China trade deal. T
The renewed optimism on the trade deal was squashed on the reports that the US President Trump is set to sign an order restricting foreign telecom business later today. China Foreign Ministry was quick to respond, urging the US to create a fair environment for Chinese companies.
Moreover, the downward revision to the global oil demand forecast, by the International Energy Agency (IEA), for the first time since October also collaborated to the latest leg down in the prices. IEA cuts global oil demand forecast
Adding to the weakness in the black gold, the latest US crude stockpiles data published by the American Petroleum Institute (API) late-Tuesday, an unexpected rise in the US crude stocks. The US crude stockpiles rose last week by 8.6 million barrels in the week to May 10 to 477.8 million.
Looking ahead, the commodity could draw support from the ongoing Middle East tensions. Saudi Arabia said on Tuesday that armed drones struck two of its oil pumping stations, two days after the sabotage of oil tankers near the United Arab Emirates, as cited by Reuters.
However, the main deciding factor for the next direction is likely to be the official data on stocks from the US Energy Information Administration (EIA) due later today at 1430 GMT.
WTI Technical Levels
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