Brent crude on Wednesday traded $43.70 a barrel and West Texas Intermediate (WTI) was changing hands at $41.37 a barrel, slightly up from Wednesday’s close.
The $40-43 range has proved quite resilient over the past weeks, not least because of the global economy outlook amid the pandemic, which remains overwhelmingly pessimistic, with expectations for slower rather than quicker recovery around the world, notably in the United States (U.S), the world’s largest oil consumer.
U.S. crude oil inventories shed an impressive 10.6 million barrels in the week to July 24, the Energy Information Administration (EIA) reported yesterday. This compares with a build of 4.9 million barrels for the previous week. However, inventories remain 17 per cent above the five-year seasonal average.
A day earlier, the American Petroleum Institute (API) reported an estimated crude oil inventory decline of 6.83 million barrels, versus analyst expectations of a much more modest draw of 357,000 barrels.
A surge in new Covid-19 infections in the United States (US) offset the oil price gains that followed the API’s report and now the figures that the EIA has reported will likely help prices recoup some of those losses.