Commodity Market: US Crude Oil advances a fourth day, but gains limited by demand worries, US-China tensions

Futures on US West Texas Intermediate Crude Oil advanced for a fourth straight trading day on Thursday, but gains seemed limited after US crude oil stocks unexpectedly rose, indicating an impact from the accelerating COVID-19 pandemic on US fuel consumption.

More than 15 million people worldwide have already been infected by the novel coronavirus, while, in the US, California overtook New York in terms of total confirmed cases.

A report by the US Energy Information Administration showed on Wednesday that crude oil inventories had risen by 4.892 million barrels to 536.6 million barrels during the week ended July 17th. That followed the sharpest drop in oil stocks since December, registered in the week ended July 10th. In comparison, analysts on average had expected a 2.088 million decrease in inventories last week.

US distillate inventories also rose unexpectedly in the week ended July 17th.

At the same time, daily oil production increased by 100,000 barrels to 11.1 million barrels.

Escalating diplomatic tensions between Beijing and Washington may also restrain oil gains. China has a deadline until Friday to close its consulate in Houston on accusations of espionage, while it has also pledged to respond accordingly. A Thursday report by Reuters stated that the Asian economic giant was considering to close the US consulate in Wuhan.

Oil traders now expect the latest consumer confidence data coming out from the Euro Area later Thursday for more clues on fuel demand.

As of 9:05 GMT on Thursday WTI Crude Oil Futures were gaining 0.69% to trade at $42.25 per barrel, after earlier touching an intraday high of $42.29, or a price level not seen since July 21st ($42.49), a 4 1/2-month high. WTI Crude Futures have risen 4.20% so far this week, after remaining flat in the prior week.

Brent Oil Futures were gaining 0.93% on the day to trade at $44.69 per barrel, after earlier touching an intraday high of $44.74, or a price level not seen since July 21st ($44.86), also a 4 1/2-month high. Brent Oil Futures have gained 3.74% so far this week, after retreating 0.39% in the preceding week.

Daily Pivot Levels (traditional method of calculation) – WTI Crude Oil Futures

Central Pivot – $41.71
R1 – $42.25
R2 – $42.54
R3 – $43.08
R4 – $43.62

S1 – $41.42
S2 – $40.88
S3 – $40.59
S4 – $40.30

Daily Pivot Levels (traditional method of calculation) – Brent Oil Futures

Central Pivot – $44.10
R1 – $44.56
R2 – $44.84
R3 – $45.30
R4 – $45.76

S1 – $43.82
S2 – $43.36
S3 – $43.08
S4 – $42.80