After gaining for two consecutive trading days by breaking a six-day losing streak, the sell-off in crude oil markets resumed. In the early hours on April 27, crude oil prices opened gap down and traded lower.
Gasoline inventory dented the sentiment
Crude oil prices pulled back on Wednesday and are weaker today due to a rise in gasoline inventory levels. Despite the fall in crude oil inventory levels, prices didn’t move higher. The effect is overshadowed by a rise in gasoline inventory levels. According to data released by the U.S. Energy Information Administration, crude oil inventory levels fell by 3.64 MMbbls (million barrels) in the week ending on April 21. It’s better than the expected fall of 1.66 MMbbls. However, gasoline inventory levels rose by 3.4 MMBbls and weighed on oil prices.
The market sentiment is stable due to expectations of an extension of the supply cut agreement by major oil producers. The market is looking forward to the US oil rig count by Baker Hughes, which is scheduled to release on Friday. An increase in the US rig count weighs on oil prices.
At 6:30 AM EST on April 27, the West Texas Intermediate crude oil futures contract for June 2017 delivery was trading at $49.16 per barrel—a fall of ~0.93%. The Brent crude futures contract for July 2017 delivery fell ~1.0% to $51.87 per barrel. The PDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $35.87 after falling 0.61% on April 26.
After gaining for three consecutive trading days, copper prices are slightly weaker but stable at two-week high levels in the early hours on April 27. Weakness in the US dollar in the early hours is supporting copper prices today. At 6:35 AM EST on April 27, the COMEX copper futures contract for July 2017 delivery was trading at $2.6 per pound—a fall of ~0.21%. The PowerShares DB Base Metals ETF (DBB) rose 0.51%, while the SPDR S&P Metals & Mining ETF (XME) fell 0.03% on April 26.
On the other hand, gold (GLD) and silver (SLW) are positive in the early hours amid weakness in market sentiment due to the announced tax cut plan. Weaker market sentiment supports precious metal commodities such as gold and silver. Platinum is stable, while palladium is weaker in the early hours. Read S&P 500, NASDAQ, and Dow Pulled Back amid New Tax Cut Plan to know why Wall Street’s sentiment is weaker.