By Barani Krishnan
Investing.com – U.S. crude prices dipped for the first time in five days on Wednesday but stayed firmly above the $80 per barrel mark as the trade awaited inventory data that could show a third straight weekly build.
In another show of resolve, oil bulls refused to allow any meaningful drop in prices despite OPEC trimming its world demand growth forecast for 2021. Russian President Vladimir Putin also said he did not want to see crude prices skyrocket, although he admitted that $100 a barrel was a possibility.
U.S. crude’s West Texas Intermediate benchmark settled down 20 cents, or 0.25%, at $80.44 per barrel. WTI has gained more than 4% in four previous days of trade.
London-traded Brent crude, the global benchmark for oil, settled at $83.18, down 24 cents, or 0.3%. It was Brent’s second straight decline after a three-day winning streak that netted more than 3%.
The American Petroleum Institute will issue at 4:30 PM ET (20:30 GMT) a snapshot on U.S. crude, gasoline and distillate stockpiles for the week ended Oct 8. The figures serve as a precursor to the official weekly inventory data due on Thursday from the EIA, or U.S. Energy Information Administration.
Analysts tracked by Investing.com have forecast that crude inventories rose by 702,000 barrels last week, on top of the previous week’s build of 2.35 million.
Gasoline inventories likely dropped by 83,000 barrels, after the build of 3.26 million in the previous week, forecasts showed.
Stockpiles of distillates, which include diesel and heating oil, are expected to have fallen by 933,000 barrels, extending the previous week’s slide of 396,000.
While oil prices closely follow economic growth, the current rally in crude is completely at odds with the inflationary burden experienced by economies emerging from 18 months of varying hardship imposed by the coronavirus pandemic.
The much-anticipated tapering of the Federal Reserve’s long-running Covid-19 economic stimulus could start by November or December and conclude by the middle of next year, minutes from the latest monthly meeting of the central bank’s policy-making committee said Wednesday.
The IMF said in its World Economic Outlook on Tuesday noted that the momentum of growth has weakened while uncertainty has increased. The IMF is concerned that surging commodity prices will force central banks into tightening cycles that could trigger selloffs in global equities.