Crude oil regained strength last week amid expectations of improved global demand for oil in 2H17. Crude oil opened the week on a mixed note by pulling back on Monday. It opened higher on July 18 and traded with strength in the early hours.
The sentiment in the crude oil market is mixed. Increased demand expectations offset concerns about oversupply conditions in the market. Crude oil prices are supported by signs of increased global demand. According to recent data, China’s oil imports in 1H17 were 8.55 MMbpd (million barrels per day)—an increase of 13.8% from the same period last year. India’s crude oil imports in June were 4.38 MMbpd—growth of 3.7% year-over-year. The market is looking forward to crude oil inventory reports from the American Petroleum Institute and the U.S. Energy Information Administration this week.
At 7:20 AM EST, West Texas Intermediate crude oil futures contracts for August 2017 delivery were trading at $46.49 per barrel—a rise of ~1.1%. Brent crude futures contracts for September 2017 delivery rose ~1.2% and were trading at $48.99 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $31.89 after falling 0.06% on July 17.
After regaining strength last week, copper opened this week on a stronger note. It rose to the highest levels since March 1 amid China’s stronger-than-expected economic data. China’s stronger-than-expected industrial production and second quarter GDP data raised demand expectations for copper in 2H17. Copper opened higher on July 18 but traded below the opening price in the early hours.
The PowerShares DB Base Metals ETF (DBB) rose 0.49%, while the SPDR S&P Metals & Mining ETF (XME) rose 1.2% on July 17. Gold (GLD) and silver (SLW) are stable in the early hours. Gold prices gained strength after Fed Chair Janet Yellen’s dovish tone in her testimony last week. Weakness in the dollar amid dented market sentiment is supporting gold prices. The weak dollar supports the prices of dollar-denominated commodities. Platinum and palladium are stable in the early hours.