Crude oil prices are on the rise after stockpiles showed a slight increase and a substantial improvement in demand. According to the EIA crude oil inventory report, demand for gasoline and crude oil increased while distillates declined. Crude oil exports rose 21.6%, as shipments to foreign countries reached their highest level since November. The stockpiles are still high, reaching the highest level since March. However, gasoline prices have not been affected.
It seems that the oil market is inclined to take a bullish turn after major oil events. WTI crude should encounter resistance before the $83.50 mark, but if it does not hold we could see a small breakout.
The tech-driven selloff has caused a significant drop in risk appetite, which should have an impact on crude oil prices.
As traders wait to see what the Fed does to address growing concerns about a slowdown in macroeconomic growth, gold prices have been locked into consolidation mode. While risk aversion has taken over, gold is not in danger. The slowdown will confirm the disinflation trends and could result in rate cuts at year’s end. Until the Fed event, gold could trade in the $1935 to $1960 range.