WTI Crude has reversed directions on Wednesday, as crude futures trade at $36.71 per barrel in Wednesday’s North American session. In economic news, Crude Oil Inventories surprised the markets with a surplus of 2.6 million. Pending Home Sales came in at -0.9%, well below expectations.
Crude oil prices have dropped sharply on Wednesday, reversing the gains made a day earlier. WTI/USD has lost over 3% of its value on Wednesday, responding sharply to an unexpected surplus in crude inventories. The weekly indicator surged 2.6 million, surprising the markets which had expected a loss of 1.8 million. US and global oil supplies continue to far exceed demand, and oil-producing nations are pumping out oil at high levels, hoping to hold onto market share even as oil prices continue to slide. Earlier in December, crude dropped below $35, its lowest level since February 2009. The sharp descent could continue into 2016, with some analysts predicting that the commodity will drop below the $30 level. That scenario hasn’t happened since February 2004.
CB Consumer Confidence sparkled on Tuesday, as the key indicator jumped to 96.5 points, up sharply from 90.4 points a month earlier. This easily beat the estimate of 93.9 points. This follows a solid UoM Consumer Sentiment, which improved to 92.6 points, above the forecast of 92.1 points and marking a 4-month high. Consumer confidence indicators are closely monitored by analysts, as stronger consumer confidence often translates into increased consumer spending, a key driver of economic growth. Strong consumer demand has been an important factor in the strength of the US economy, which led to the historic rate hike by the Federal Reserve last week.
Wednesday (Dec. 30)
- 15:00 US Pending Home Sales. Estimate +0.6%. Actual -0.9%
- 15:30 US Crude Oil Inventories. Estimate -1.8M. Actual +2.6M
*Key releases are highlighted in bold
*All release times are GMT
WTI/USD for Wednesday, December 30, 2015
WTI/USD December 30 at 16:50 GMT
WTI/USD 36.71 H: 37.87 L: 36.41
- Crude has been on a downward trend for most of the day.
- There is resistance at 37.75
- 35.09 continues to provide support
Further levels in both directions:
- Below: 35.09, 32.22 and 30.00
- Above: 37.75, 39.87, 42.59 and 47.05
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