After rebounding for four consecutive trading days, crude oil prices pulled back on Wednesday. In the early hours on June 28, crude oil prices are trading with weakness amid supply glut concerns.
Despite the brief rebound in crude oil prices, the market sentiment is still bearish amid supply concerns. Higher crude oil inventory levels reported by the API (American Petroleum Institute) brought back selling pressure for oil contracts. According to inventory data released by the API on June 27, US crude oil inventory levels rose by 0.851 MMbbls (million barrels) in the week ending June 23. The market lost momentum after the inventory report. The market expected stock levels to fall by 2.6 MMbbls. The market is looking forward to the inventory report by the U.S. Energy Information Administration, which is scheduled to release at 10:30 AM EST today.
At 6:40 AM EST, West Texas Intermediate crude oil futures contracts for August 2017 delivery were trading at $44.02 per barrel—a fall of ~0.5%. Brent crude futures contracts for September 2017 delivery fell ~0.26% and were trading at $46.80 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $31.13 after rising 0.1% on June 27.
After rising on Tuesday to more than two-month high price levels, copper is trading with weakness in the early hours on Wednesday. Despite weakness in the dollar, copper prices are weaker due to concerns about China’s economic stability in the coming months. Considering that China is the largest copper consumer, China’s economic outlook will impact copper’s demand and price trends.
The PowerShares DB Base Metals ETF (DBB) rose 1.2%, while the SPDR S&P Metals & Mining ETF (XME) fell 0.45% on Tuesday. After regaining some strength on Tuesday, gold (GLD) and silver (SLW) continued to trade higher on June 28. Weakness in the dollar along with weak global sentiment supported gold prices. The weaker dollar supports dollar-denominated commodities like gold and silver. Platinum is stable, while palladium is weaker in the early hours.