Oil Rebounds from 5-Week Low, WTI Jumps +2.5%
Oil benchmarks
on both sides of Atlantic extend the recovery mode from multi-week lows
on Wednesday, on mounting expectations of out freeze and drawdown in
crude reserves.
Oil awaits EIA report
Currently
both crude benchmarks are seen extending to the upside, with WTI
rallying 2.45% to $ 36.77 while the Brent oil rises +1.64% to $ 38.49.
Oil prices is seen trading with size-able gains this session as
sentiment remains buoyed after the API inventory report revealed that
the US crude reserves declined for the first time in three weeks,
offering some respite to the oil bulls.
The American Petroleum
Institute reported late on Tuesday that US crude inventories fell by 4.3
million barrels over the week to April 1. Analysts had expected growth
of about 3.2 million barrels.
Moreover, rising expectations that
the official EIA stockpiles report due later today will also show a
withdrawal, collaborated to the upside in the black gold. Markets
predict crude reserves in the US to have expanded by another 3.1 million
barrels, following a rise of 2.3 million barrels a week before.
Furthermore,
markets believe that the output freeze talks may soon become reality as
we head closer towards April 17 Doha OPEC producers meeting to discuss
the oil output freeze deal, proposed earlier this year, in order to
limit production at January levels. Meanwhile, the FOMC minutes will be
also closely eyed for any further move on the USD priced-in oil.
(Market News Provided by FXstreet)