There’s nothing in the cards to show crude oil prices could turnaround this week. Especially since volume is expected to be light due over the Christmas holiday. We could, however, see some whipsaw trading conditions especially. Because of the heightened stock market volatility.
U.S. West Texas Intermediate and international-bench. Brent crude oil futures plummeted over 11 percent. Last week with investors doubting the impact of the planned OPEC-led production cuts. Which are expected to begin on January 1. Concerns over rising U.S. production also continue to dominate the trade. Traders also continued to be worried about the strength. The global economy heading into the new year.
In posting its worst week since January 2016. Traders also blamed the global supply glut. Heightened stock market volatility. And fears of a government shutdown as other reasons. Why the hedge funds remained convincingly short crude oil.
Weekly U.S. Energy Information Administration Report
Oil prices were supported a little at mid-week after the U.S. government reported. A third straight weekly decline in U.S. crude supplies and a drop in distillate stocks.
The U.S. Energy Information Administration (EIA) reported. That domestic crude supplies fell by 500,000 barrels. For the week-ended December 14. Traders were looking for a larger decline of 3 million barrels in crude supplies. This was better than the American Petroleum Institute’s. report on Tuesday which showed a 3.5 million barrel rise.
Gasoline stockpiles rose by 1.8 million barrels the week-ended December 14. Distillate stockpiles dropped 4.2 million barrels. According to the EIA. Traders were looking for gasoline inventories to increase 2.6 million barrels. And for distillate stocks to fall 900,000.