Crude Oil Down Despite A Steep Drop In US Crude Inventories Last Week

  • Commodities Analysis

Crude oil yesterday settled down by -2.73% at 3059 despite a steep drop in U.S. crude inventories last week, as worries about a drop in gasoline demand and data showing a surge in oil production by OPEC members weighed on prices. OPEC oil output has risen by about 1 million barrels per day (bpd) in August, as the group and allies eased record oil supply curbs as the global economy and demand began to recover from the coronavirus pandemic.
  
The 13-member Organization of the Petroleum Exporting Countries pumped 24.27 million bpd on average in August, the survey found, up 950,000 bpd from July's figure and a further boost from the three-decade low reached in June. U.S. Gulf of Mexico offshore oil output was down by 525,099 barrels per day or 28.4% of the region's daily production, the U.S. Department of Interior reported, as energy companies restarted more activity in the aftermath of Hurricane Laura.
  
The regulator said 71 of the U.S. Gulf of Mexico's 643 manned platforms remained evacuated, down from 117 production platforms. Top oil exporter Saudi Arabia is expected to cut its crude oil official selling prices (OSPs) for Asian buyers for a second straight month, tracking a drop in Middle East benchmarks and weak refining margins.
  
Technically market is under fresh selling as market has witnessed a gain in open interest by 30.71% to settled at 1928 while prices down -86 rupees, now Crude oil is getting support at 3007 and below the same could see a test of 2954 levels, and resistance is now likely to be seen at 3139, a move above could see prices testing 3218.
  
Trading Ideas:
# Crude oil trading range for the day is 2954-3218.
# Crude oil dropped as worries about a drop in gasoline demand and data showing a surge in oil production by OPEC members weighed
# OPEC August oil output rises for 2nd month as cut eased
# Saudi Arabia may cut October crude oil prices to Asia

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