WTI starts the day off bid despite covid concerns

At the time of writing, US West Texas Intermediate (WTI) crude is higher by some 0.22% at the start of Wednesday's trading following a terrible day overnight. WTI dropped from a high of $71.92 to a low of $69.22 as concerns of the delta variant gripped. 

In more recent trade, however, a private oil survey showed a smaller than expected headline draw in crude oil inventory

Official data follows Wednesday in the morning of the US session. 

• Crude -0.879M.
• Cushing +0.659M. 
• Gasoline -5.751M. 
• Distillate -0.717M.

Concerns over the spread of Delta variant in the United States and China, the top oil consumers, weighed on prices on Tuesday.

Both benchmarks were falling more than 3% at one point. Brent crude oil futures settled down 48 cents, or 0.66% at $72.41 a barre. WTI crude settled down 70 cents, or 0.98% at $70.56 a barrel.

Reports of a recently leaked document from the CDC was partly to blame.

According to the New York Times, the reports said that the Delta variant is more transmissible than the common cold, 1918 Spanish flu, smallpox, Ebola, MERS, and SARS. Also, in China, the spread of the variant from the coast to inland cities has prompted authorities to impose strict measures to bring the outbreak under control which has dented the demand side case for energy markets. 

Looking beyond covid, rising energy demand risk should continue to support higher prices. The OPEC+ supply increases of 400,000 barrels per day of new production that have started this month are still seen to be underwhelming.