Crude Oil turned quite bearish in the first week of this month, as US WTI fell to $81.20s. At the beginning of this week, we saw a retrace higher, which ended at the 200 SMA (purple) as it rejected the price. The price fell below $82 again, but earlier today we saw another bullish move, as Russia called to mobilize reservists on threats from the outside to destroy the Russian Federation.
That turned the sentiment negative, although it was positive news for Oil which jumped more than $2.50. Although, the 200 SMA came into play once again, holding as resistance despite being pierced to the upside and eventually reversing US WTI Oil lower.
US WTI Oil H1 Chart – Failing at the 200 SMA
US Oil has lost more than $3 after the reversal lower
Today the Oil prices fell on Tuesday under pressure as the U.S. dollar appreciated in anticipation of another big rate hike by the Federal Reserve later today. Although crude Oil inventories are also weighing on Oil prices, after another buildup.
The American Petroleum Institute (API) reported yesterday an increase of 1.035 million barrels of crude oil in U.S. inventories for the week ending Sept. 16. Analysts had expected a hike of 2.321 million barrels for this week, after reporting a surge of 6.035 million barrels in the previous week. Today the EIA showed another major buldup.
US EIA Crude Oil Inventories
- EIA Oil inventories +1,142K vs +2,161K expected
- Prior week inventories were +2,442K
- Crude +1,142K vs +2,167K expected
- Gasoline +1,569K vs -430K expected
- Distillates +1,231K vs +420K expected
- Implied gasoline demand 8.33m vs 8.50m last week
- SPR draw 6.9m vs 8.414m prior
This isn’t far off expectations, which were more bearish after the API data from late yesterday showed:
- Crude +1,035K
- Gasoline +3,225K
- Distillates +1,538K