- Crude inventories declined by 12.6 million barrels from the previous week.
- Natural gas moved below the $7.00 level as rail strike risks declined.
- Copper rallied as traders bet that China would relax its zero-COVID policy after recent protests.
WTI Oil Pulled Back From Highs But Stayed Above The Key $80 Level
WTI oil continues to trade above the $80 level after the release of the EIA Weekly Petroleum Status Report.
The report indicated that crude inventories declined by 12.6 million barrels from the previous week, compared to analyst consensus of 2.76 million. It should be noted that crude oil imports declined by 1 million bpd from the previous week.
Total motor gasoline inventories increased by 2.8 million barrels, while distillate fuel inventories grew by 3.5 million barrels. Domestic oil production remained unchanged at 12.1 million bpd.
The sharp drop in crude inventories was driven by the fall in crude oil imports, while gasoline and distillate fuel inventories increased significantly. In the near term, traders will stay focused on the upcoming OPEC+ meeting and the Russian oil price cap story.
Natural Gas Retreats As U.S. Lawmakers Are Ready To Prevent The Strike
Natural gas pulled back below the $7.00 level as traders reacted to the decreasing risk of a rail strike.
The U.S. lawmakers plan to pass legislation that would avert the strike, which is bearish for natural gas markets. At this point, it looks that natural gas has a good chance to gain additional downside momentum in the near term.
Gold Pulls Back From Session Highs As Dollar Rebounds
If gold settles below the $1750 level, it will move towards the next support level, which is located near the 20 EMA at $1730. A move below this level will open the way to the test of the support at the 50 EMA at $1715.
On the upside, gold needs to settle above the resistance at $1765 to gain additional upside momentum. The next resistance level for gold is located at $1775. A successful test of this level will push gold towards November highs at $1785.
Other precious metals are moving higher as traders hope that China will gradually ease its strict zero-COVID policy. Silver made an attempt to settle above the $22.00 level. Platinum moved towards $1050, while palladium rebounded towards the $1850 level.
Copper Tries To Settle Above $3.75
Copper rallied towards the $3.75 level as traders bet that China’s demand would increase when the country relaxes its anti-coronavirus measures. If copper settles above $3.75, it will head towards the next resistance at $3.80.
For a look at all of today’s economic events, check out our economic calendar.