- WTI drifts lower for the second successive day, though any meaningful slide seems elusive.
- Concerns that geopolitical tensions can cause supply disruptions could offer some support.
- Traders now look to the OPEC+ meeting for some impetus ahead of the key US NFP report.
West Texas Intermediate (WTI) US Crude Oil prices remain under some selling pressure for the second straight day on Thursday and have now reversed a major part of weekly gains. The commodity trades below mid-$68.00s, down 0.30% for the day during the Asian session, though the downside remains cushioned ahead of the OPEC+ meeting later today.
Reports suggest that the cartel will further delay plans to increase production until at least the second quarter of 2025 amid concerns over slowing oil demand, especially China – the world’s top importer. Furthermore, the worsening Russia-Ukraine conflict and increasing tensions in the Middle East keep geopolitical risks premium in play, which, in turn, could act as a tailwind for Crude Oil prices.
Meanwhile, the official data released by the Energy Information Administration (EIA) on Wednesday showed that US oil inventories shrank more than expected, by 5.07 million barrels in the final week of November. Moreover, signs of US economic resilience, and hopes that US President-elect Donald Trump’s expansionary policies will boost fuel demand, should limit losses for Crude Oil prices.
Traders might also refrain from placing aggressive directional bets and opt to wait for the release of the US Nonfarm Payrolls (NFP) report. The closely watched employment details will play a key role in influencing market expectations about the Federal Reserve’s (Fed) rate-cut path. This, in turn, will influence the US Dollar (USD) price dynamics and provide a fresh impetus to Crude Oil prices.
