- WTI prints high above $52.00, extending Wednesday’s gains.
- US oil inventories rose more than expected in the last week of January.
WTI oil is extending overnight gains despite the uptick in the US oil inventories.
At press time, the black gold is trading near $51.80, representing a 2 percent gains on the day, having hit a high of $52.16 a few minutes ago.
Prices closed Wednesday on a positive note at $51.15, snapping a ten-day losing streak, even though the Energy Information Administration reported an oil inventory build-up of 3.4 million barrels for the last week of January.
Markets had penciled in an inventory buildup of 3 million barrels, following the previous week’s 3.5 million barrel build.
Further, Saudi Arabia’s plans to deepen production cuts to support oil prices were resisted by Russia. The Kingdom reportedly pushed for a production cut of at least 500,000 barrels a day and even up to twice that amount, according to some Opec+ delegates. Russia, however, rejected the idea and suggested an extension of the current pact – back in December, the alliance pledged to deepen curbs to 1.7 million barrels a day.
Even so, oil eked out gains, possibly on reports stating that Chinese scientists may have found a treatment for the deadly coronavirus.
That optimism is likely keeping oil better bid in Asia. The black gold, however, may erase gains if the risk sentiment worsens, although at press time, the futures on the S&P 500 are pointing to an extension of Wednesday’s price rally with a 0.30% gain.
