WTI Oil fails to consolidate above $80 for a third time in two weeks. Oil traders are surprised to see a very light auction ahead for the US Strategic Oil Reserve. The US Dollar Index sinks for a fifth straight day ahead of the ECB decision. Oil prices are retreating in both Brent and WTI on Thursday after markets were surprised by the small auction from the US Energy Department. The US is seeking only 3 million barrels, which, seeing its own production volume, is a very minor amount. A similar story is being portrayed in the European Gas market, where sluggish demand puts downward pressure on prices as the European Union needs less Gas to restock its reserves ahead of the next heating season.
Meanwhile, the US Dollar Index (DXY) has printed a new monthly low after US Federal Reserve Chairman Jerome Powell confirmed to the US Congress that rate cuts are coming this year. That confirmation for markets was enough to narrow the rate differential gap between the US Dollar and other currencies, which led to a substantial depreciation of the Greenback against most of its peers. With a light data calendar ahead, markets will be rather focused on the other side of the Atlantic, with the European Central Bank (ECB) holding its rate decision and press release with traders looking for similar clues on rate cut timing for the Euro.
WTI) trades at $78.10 per barrel, and Brent Oil trades at $82.08 per barrel at the time of writing.
Oil news and market movers: US Strategic Reserves well equipped The US Energy Department already bought 26.28 million barrels this year for its Strategic Oil Reserves and is, for now, only looking to buy another 3 million barrels by September. This could point to tepid demand expectations for the coming months. BP Plc. is set to reduce the crude production at its German refineries in 2025. The main reason is the falling demand in the region. The Energy Information Administration (EIA) released on Wednesday its recent stockpile numbers, with Crude inventories printing another build by 1.37 million barrels. Several tanker companies are reporting substantially more bookings from China. The tankers are carrying crude from the Persian Gulf. The move coincides with the pickup in leisure and travelling by plane in China and Asia overall.
