|Previous||2.6 million barrels|
|Forecast||3.6 million barrels|
|Analysis||Crude oil fluctuates heavily today ahead of the EIA report, where it is trying to correct some of yesterday’s losses after it gathered momentum and managed to fly above $101 levels, but bad data from the United States pushed crude down to trade below $100 levels again and end the day with losses.|
Crude oil couldn’t maintain its upside direction which took it above $101 levels amid improving sentiment in Europe and hopes that Greece is close to a deal between its private bondholders after a successful summit supported confidence in the continent.
Crude oil opened today’s session at $98.29 and reached a high of $99.11 and a low of $98.26, where it is currently trading around $99.06.
The American Petroleum Institute (API) reported yesterday that U.S. crude inventories rose by 2.1 million barrels last week to 339.5 million barrels, the highest since November, ahead of the EIA report that is expected as well to show a buildup in inventories.
The United States has played a negative role yesterday when the country released confidence figures that showed that it declined unexpectedly in January, also, the data showed that the manufacturing sector is struggling in world’s no.1 economy and biggest oil consumer.
However, the world’s second biggest economy and oil consumer, China, gave crude upside momentum as the PMI manufacturing in January rose to 50.5 compared with the prior reading of 50.3 and opposed to expectations for a contraction at 49.6.
The manufacturing data from China and to Europe today are surely positive for crude yet the debt crisis remains a predominant concern. Greece is so close to reaching a deal with private bondholders which supports the sentiment as the Greek PM said that his country will reach a deal with private bondholders before the end of this week.
Crude oil benefited today from better manufacturing in Europe last month as PMI data showed, easing the fear over the outlook and extent of slowdown from the debt crisis.
Today, the EIA is expected is expected to report a rise in U.S. crude inventories last week by 2.6 million barrels compared to the previous reading at 3.6 million barrels, which will have a negative effect on crude prices and signals that the world’s biggest oil consumer consuming is easing amid hard challenges that face the economy.
Also, investors will be waiting for any developments on Greece negotiations with private sector, and good results are expected for both parties, where important U.S. data is due today and will be closely monitored by investors especially the ADP and the ISM figures that might support the rise or end it once again like yesterday.