U.S .. Inventories: On Wednesday, the US Energy Information Administration reported that crude oil rose by 3.2 million barrels a week ended 26 October, marking its sixth week with subsequent increases. Prices had been under pressure after the American Petroleum Institute, an industry group, reported its own estimates of a 5.7 million barrel of barley. Analysts and retailers surveyed by The Wall Street Journal had averaged an increase of 2.9 million barrels. Meanwhile, petrol containers fell by 3.2 million barrels and the distillate stocks fell by 4.1 million barrels.
Global Growth: Concerns about the weakening of global economic growth have weighed on stocks in recent weeks, with a huge accident of volatile equity markets. Raw prices have fallen about 1[ads1]2% from the four years achieved in early October. West Texas Intermediate Tuesday fell to its lowest level since mid-August. An important focus point remains the escalating trade disputes between the US and China, when President Trump threatened fresh tariffs on Beijing this week. "Such threats do not contribute well to the health of the world economy and thus to oil demand prospects," according to Stephen Brennock, an analyst at the PVM Oil Associates Ltd.
Yegor Aleyev / TASS / Zuma Press
U.S .. Dollar: A stronger dollar also puts pressure on oil prices. The WSJ Dollar Index increased by 0.1% to 90.91, and is 5.7% year-on-year. Dollar-denominated commodities as commodities become more expensive for foreign investors as the US currency strengthens.
Equities: Analysts continue to associate the results in oil and stocks, both exposed to cracks in global growth expectations. On Wednesday, Dow Jones Industrial Average increased 1% and the S & P 500 gained 2.1%. "I think the market will be very sensitive to stocks," said Kyle Cooper, consultant at ION Energy. "If stocks do not find bottom, you can probably see" oil prices go lower.
Speculative Investors: "We are now in late October and exchanges have seen a great erosion of speculative bullishity since Brent prices affected $ 86 a barrel in the first week of this month," analysts in consultancy firm JBC Energy wrote in a daily note Wednesday. "Net long positions in commodities among money managers have shrunk by a combined 260,000 share over the last four weeks," they added.
OPEC: All eyes are on Iran, a key member of the Organization for Petroleum Exporting Countries, and US sanctions on the oil industry of the Islamic Republic. Iran's red exports have already fallen by around 800,000 barrels a day since President Trump pulled out the United States from an 2015 international agreement to curb Iran's nuclear program and set the scene for repositioning sanctions. Oil market participants are looking closely at whether Saudi Arabia, the de facto leader of OPEC, and its production relations, including Russia, will be able to fill the gap again after reducing Iranian supply.
- Royal Dutch Shell PLC provides quarterly earnings on Thursday.
Write to Christopher Alessi at email@example.com and Stephanie Yang at firstname.lastname@example.org