WTI reverses gains on unexpected increase in US crude stocks

Eren Sengezer FXStreet

Crude oil prices lost their bullish momentum in the post-settlement-trade after the American Petroleum Institute's weekly report revealed a surprise in crude oil stocks in the United States. After inching higher towards the critical $65 mark during the NA session and settling nearly $1 higher, the barrel of WTI plummeted down to $64.30 with the knee-jerk reaction to the report. As of writing, the barrel of WTI was trading at $64.45, still up 1.4% on the day.

Following nine straight weeks of drawdowns, crude oil inventories in the U.S. increased by 4.8 million barrels in the week ending January 19 to 416.2 million, surpassing the experts' estimate of a 1.6 million barrels decrease.

Earlier today, comments from OPEC officials fueled a sharp rally in crude oil prices. According to CNBC, Saudi Arabia's energy minister Khalid al-Falih told reporters that there was an acceptance that the OPEC deal should extend beyond 2018. Moreover, in an interview with Reuters at the World Economic Forum in Davos, Qatari Energy Minister Mohammed al-Sada said that there was an excellent opportunity for OPEC and non-OPEC members to continue cooperation beyond 2018.

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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