|Previous||-1.7 Million Barrel|
|Forecast||-1.5 Million Barrels|
|Analysis||Crude Oil is currently trading near the highest in four days after the API report which showed a decline in the US crude inventories in addition to the market hopes that the Greek parliament will approve the austerity program today, and ahead of the EIA report later today.|
The weak dollar has its role in pushing oil prices to upside, as the USDIX index is currently trading around 74.97 where it opened at 75.02 recording the intraday high at 75.13 and the low of 74.98.
Light sweet crude oil for August settlement opened today at $93.09 a barrel recording the highest at $93.35 a barrel and the lowest at $92.64 a barrel and is currently trading around $92.99 a barrel.
The American Petroleum Institute (API) said yesterday that US crude stockpiles dropped by 2.7 million barrels to reach a total of 360.3 million barrels, that supported the upward trend for oil. Investors are waiting for a confirmation that the US crude oil supplies are tightening so the Energy department will release its weekly status report at 10:30 EST, as it’s expected to report a drop by 1.5 billion barrel, lower than the previous report that showed a drop by 1.7 million barrel. the drop in crude stocks indicates a stronger demand in the US (the world’s biggest economy and the largest oil-consuming nation) especially as the summer driving season starts and the focus remains on motor gasoline inventories.
Today, the Greek parliament will vote on the austerity measures required by lenders, so the European Union and International Monetary Fund approve the next installment of Greece’s 110 billion euro bailout, and without it Greece will become the first euro zone country to default as soon as in weeks!
Concerns are slightly easing as the French president Nicolas Sarkozy continues to talk with banks over the voluntary rollover of Greek debt for 30 years and German banks talks on the matter are expected to start today. It is more obvious for everyone that the possibility of Greece to default is weakening due to the huge risk associated with it, as it will drag down the European banks and affect financially stability and other troubled European countries. So accordingly letting Greece default will be prevented as much as possible by leaders.
The eased concerns supported commodities and oil to continue the upside move, and the main focus remains on the debt crisis and especially with the vote today expected around 14:00 Greece time, thus the volatility will return, oil gains remain limited pending the vote and the supply data today.