WTI Crude Trading Near a Five Month Low, Crude Oil Futures Gain

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WTI Crude Trading Near a Five Month Low, Crude Oil Futures Gain
WTI Crude Trading Near a Five Month Low, Crude Oil Futures Gain

WTI Crude Trading Near a Five Month Low, Crude Oil Futures Gain

Whereas West Texas Intermediate crude traded near a five-month low as estimates are coming out that the U.S. has huge stockpiles, the crude oil future prices posted the biggest gain in more than one month. According to market observers, WTI crude is low as markets are oversupplied even when the U.S., the largest oil consumer is on the recovery path.

Reportedly, despite low WTI crude trading, futures were little changed today for crude oil futures for the week in New York. The positive outlook has come after a run of four weekly losses that this commodity faced. In fact, U.S. crude inventories are at their highest as according to some reports it is touching almost five months high and 2.5 percent above year-ago levels.

Reports also claim that crude-oil futures prices are expected to increase from the current prices. The best thing that happened is that crude oil futures have gone up which is the biggest gain in five weeks. The increase in the prices is happening amidst the news that government data has come up that suggests that there has been stronger-than-expected demand for gasoline and diesel fuel recently.

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Gasoline Stockpiles Drop

Whereas U.S gasoline stockpiles have dropped 3.755 million barrels in the week ending Nov. 1, according to some estimates it has fallen to the lowest level since Nov. 23. Concurring with the report the Energy Information Administration said that implied demand for gasoline in the latest week was 9.29 million barrels a day which according to it is the highest since July 5 this year.

Similarly, according to reports, stocks of distillate fuel that comprises diesel and heating oil also went downward as it fell by 4.9 million barrels. However, when it is compared with expectations of a drop of 900,000 barrels, it fell more than what was expected. Nonetheless, even stocks fell to the lowest level since May 3 amidst the reports that implied demand was reported at the highest level six years ago.

Some observers are of the belief that the declining inventories of refined products are expected to send the right signal for crude oil, particularly, when refiners are expected to restart facilities after seasonal maintenance. They also believe that crude stocks rose 1.6 million barrels last week which is less than the 1.9 million-barrel increase as some analysts had expected.

To contact the reporter of this story: Jonathan millet at john@forexminute.com