WTI trims gains below $70 amid lower Asian imports, USD rebound

Crude oil retreats from the higher level and trades with negative bias on Monday in the  European trading hours. The pair refreshed multi-year highs in the previous week after OPEC+ decided to cut the supply ease in May.

At the time of writing, WTI trades at 69.02, down 0.88% for the day.

As per Reuters, the world’s most important oil-importing region, Asia is showing some signs of weaker physical demand with lower cargo arrivals in May. The major reason remains the covid-19 resurgence in most of the South Asian countries, which depresses fuel demand in the continent.

India, the world’s third-largest importer of crude oil, is struggling with the new coronavirus strain named ‘delta’ by WHO. The strain is considered to be highly transmissible and with serious health concerns. The weaker demand in the country puts dents on crude oil prices.

Meanwhile, Malaysia and Japan already extended their lockdown till late June. The latest addition is the extension of the level 3 restriction in Taiwan until June 28.

The rebound in the US Dollar Index (DXY), which regained its strength on Monday, puts pressure on the dollar-denominated commodity.

In the previous week, the Energy Information Administration (EIA) reported a decline of crude oil inventories of 5.1million barrels in the week to May 28. The lower reading boosted oil prices.

Now, investors' eyes are on the outcome of this week’s talk between the US and Iran over a nuclear deal that is expected to boost crude supplies. If that happens, then it could dampen the sentiment surrounding crude oil prices on increased supply.

WTI additional levels