WTI struggles around six-week high below $71.00 despite softer API stockpiles

WTI seesaws around $70.50 after a three-day uptrend to early August levels amid Wednesday’s Asian session. While hurricane Ida and tropical storm Nicholas pleased oil bulls to refresh multi-day top the previous day, US dollar strength challenged the energy bulls despite price-positive private inventory data.

The weekly reading of the American Petroleum Institute (API) Crude Oil Stocks dropped below -2.882M prior to -5.437M during the week ended on September 10. News sources mark hurricanes as the major blow to the latest inventory data. “Energy companies in the US Gulf of Mexico dealt with a fresh blow from Tropical Storm Nicholas that made landfall as a hurricane early on Tuesday, almost two weeks after Hurricane Ida knocked off oil and gas production in the region,” said Reuters.

On a different page, the US Dollar Index (DXY) bounced off a one-week low to regain 92.60-65 levels following the US CPI data release for August. That said, the US CPI dropped the most since January on monthly basis to 0.3% versus 0.4% expected and 0.5% prior. The CPI ex Food & Energy also dropped below 0.3% expected and previous readings to 0.1% during August, marking the biggest fall in six months.

It’s worth noting that Iran’s readiness to back the nuclear investigations and the US-China tussles are some more catalysts challenging the black gold prices, in addition to the US dollar strength.

Moving on, the official inventories from the Energy Information Administration (EIA), prior -1.529M, will be important for the WTI crude oil prices. Before that China’s Retail Sales and Industrial Production details will join the aforementioned risk catalysts for fresh impulse.

Technical analysis

The monthly resistance line near $71.05 guards WTI’s immediate upside but the bears remain out of the radar until the quote stay beyond the $69.30 support confluence including 50-DMA and previous resistance line from early July.