After breaking a six-day gaining streak on Wednesday, crude oil prices opened lower on April 13 but regained strength. Oil prices fell overnight despite the huge draw-down in crude oil inventories.
According to data released by the U.S. Energy Information Administration, crude oil inventories fell by 2.17 million barrels in the week ending on April 7—better than the expected inventory build of 87,000 barrels. It’s biggest crude oil inventory draw-down in 2017. Despite the decline, oil prices didn’t regain strength due to the inventory report amid a rise in US oil production. Oil prices gained some strength in the early hours on Thursday. The International Energy Agency said that the oil market is very close to balancing. Speculations about extending the output cut agreement also supported oil prices. OPEC oil producers will meet on May 25 to discuss the supply cut extension.
At 7:40 AM EST on April 13, the West Texas Intermediate crude oil futures contract for May 2017 delivery was trading at $53.21 per barrel—a gain of ~0.19%. The Brent crude futures contract for June 2017 delivery rose ~0.21% to $55.98 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $37.21 after falling 1.8% on April 12.
Weaker dollar supports metal prices
After showing weakness for five consecutive trading days, copper prices regained strength in the early hours on Thursday. President Trump’s comment that the US dollar is getting too strong made the dollar weaker and supported dollar-denominated commodities like copper, gold, and silver. China’s stronger trade balance data also improved the sentiment in copper.
At 7:40 AM EST on April 13, the COMEX copper futures contract for May 2017 delivery was trading at $2.57 per pound—a gain of ~0.86%. The PowerShares DB Base Metals ETF (DBB) fell 15.7%, while the SPDR S&P Metals & Mining ETF (XME) fell 4.1% on April 12. Gold (GLD) and silver (SLW) were stronger in the early hours. Gold rose to five-month high levels amid geopolitical concerns and the weaker dollar. Platinum and palladium were also stronger in the early hours.