August 8, 2024
New Delhi, India
WTI Price
West Texas Intermediate (WTI) Oil has retraced its recent gains from the previous session, trading around $74.00 during the early European hours on Thursday. Despite the dip, crude oil prices might regain support from rising concerns about supply constraints due to ongoing geopolitical tensions in the Middle East.
Key Highlights:
- Current WTI Price Movement:
- WTI price loses ground, trading around $74.00.
- Rising supply fears over geopolitical tensions fail to maintain recent gains.
- Geopolitical Tensions:
- Two US intelligence officials indicated that Iran and its allies are preparing potential retaliation against Israel.
- The preparations are in response to the recent killings of a top military commander of Iran’s Hezbollah in Lebanon and a senior Hamas leader in Tehran, as reported by CNN.
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- EIA Crude Oil Stocks Data:
- The Energy Information Administration (EIA) reported a decline of 3.728 million barrels in crude oil stocks for the week ending August 2.
- This marks the sixth consecutive weekly decline, significantly exceeding the anticipated decrease of 0.4 million barrels and the previous decline of 3.436 million barrels.
- Global Oil Inventories:
- Reuters reported that the EIA estimates global oil inventories decreased by approximately 400,000 barrels per day (bpd) in the first half of 2024.
- The EIA projects stockpiles will decline by around 800,000 bpd in the second half of the year.
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- US Federal Reserve’s Potential Rate Cuts:
- The US Federal Reserve (Fed) is expected to implement a more aggressive rate cut starting in September.
- This follows weaker July employment data, raising concerns about a potential US recession.
- Lower interest rates could stimulate growth in the US economy, potentially increasing oil demand.
While WTI oil prices have seen a retracement, ongoing geopolitical tensions and significant declines in US crude oil inventories may provide underlying support. Investors should closely monitor developments in the Middle East and upcoming economic data from the US, as these factors could significantly influence oil prices in the near term.
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