|Previous||-5.2 million barrels|
|Forecast||-5.00 million barrels|
|Analysis||Crude oil is currently trading within a narrow range after it rose today as a drop in U.S. gasoline stockpiles offset concerns over the European debt crisis; also the EIA will release its weekly report and speculations that a decline in crude inventories indicates that demand on oil from the world’s largest oil consumer may increase.|
Light sweet crude oil for September opened today at $87.15 a barrel recording the intraday high at $87.43 and a low of $86.64 a barrel an is currently trading around $86.90 a barrel.
The USDIX which measures the dollar’s performance against other six major currencies surged today as it opened at 73.96 recording the highest at 74.18 and the lowest at 73.94 and is currently trading around 74.13.
Concerns about the debt crisis have weighed on oil markets in recent weeks, adding to concerns over the weak U.S. economic data that could hit fuel demand. The euro area economy slowed sharply in Q2, as sluggish growth in Germany and stagnation in France have raised fears of a longer-term dip, but the upbeat news from the US with its industrial output and also Fitch rating agency confirmed the country’s top notch credit rating which supported the sentiment.
U.S. industrial production recorded its best gain in seven months in July, as it rose by 0.9% compared to the prior revised rise of 0.4% and above the forecasted 0.5%, while Capacity Utilization for the same month picked up by 77.5% from the prior revised estimate of 76.9% and slightly up from the forecasted 77.0%.
Fitch Ratings confirmed the United States' top-notch credit rating and in a disagreement with its rival Standard & Poor's, gave a vote of confidence to Washington's deficit-reduction efforts.
A meeting between French and German leaders didn't result in any concrete measures to try and find a way out of Europe's sovereign debt problems, as they proposed a closer joint governance of economic policy and a tax on financial transactions, but did not propose selling euro zone bonds or increasing the euro zone bailout fund.
The American Petroleum Institute issued its weekly report yesterday which showed that US crude oil inventories rose 1.75 million barrels and that the gasoline stockpiles declined 5.37 million barrels to 205.8 million last week which is considered the biggest decline since the week ended on March 18.
The U.S. Energy Information Administration releases its weekly inventory data later today and is expected to show a 5.00 decline in the US crude inventories, which will keep the volatility and fluctuations in the markets and try to sustain oil to the upside.