After staging a brief recovery on Thursday, crude oil lost strength on July 7. Crude oil opened the day lower and traded at the lowest levels in ten days.
Despite a decline in crude oil inventory levels reported by the American Petroleum Institute and the EIA (U.S. Energy Information Administration), the crude oil market’s sentiment is still weaker. According to data released by the EIA, crude oil inventory levels fell by 6.3 MMbbls (million barrels) in the week ending June 30—better than the market’s forecast of a decline by 2.28 MMbbls.
However, the market sentiment is weaker amid supply concerns. According to reports on oil production, US crude oil production rose in the week ending June 30. OPEC’s crude oil exports rose last week to the highest levels in 2017. The supply reports raised doubts about the effective implementation of major oil producers’ supply cut agreement. The market is looking forward to oil rig count data by Baker Hughes. The data will be released at 1:00 PM EST today.
At 7:20 AM EST, West Texas Intermediate crude oil futures contracts for August 2017 delivery were trading at $44.14 per barrel—a fall of ~3.0%. Brent crude futures contracts for September 2017 delivery fell ~3% and were trading at $46.66 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $30.79 after falling 2.3% on July 6.
After closing the day almost flat on Thursday, copper is trading with weakness in the early hours on July 7. The fall in crude oil prices and the firmer dollar in the early hours are weighing on copper prices. On the other hand, increased confidence in China’s economic stability in 2H17 supported copper prices. The PowerShares DB Base Metals ETF (DBB) rose 0.12%, while the SPDR S&P Metals & Mining ETF (XME) fell 0.93% on July 6.
Gold (GLD) and silver (SLW) are weaker in the early hours on Friday. The firmer dollar weighed on gold prices, while dented global sentiment is limiting the losses. Platinum and palladium are weaker in the early hours.