Oil in yo-yo mode; U.S. stockpile game briefly offsets China gloom
Investing.com — The longs in crude might not be killing it but the “vol-players” certainly are.
Oil prices regained Tuesday all that they lost in the previous session as attention shifted from the gloom over the Chinese economy to the bright and shine that the weekly report on U.S. petroleum inventories would supposedly bring.
At the time of writing, inventories of U.S. crude were forecast to have dropped by just under a million barrels for last week versus a build in fuels — not great for market fundamentals but enough for those playing the volatility game to profit.
“There are virtually no headlines that moved the needle today for oil,” said John Kilduff, partner at New York energy hedge fund Again Capital. “But Wall Street is up on more U.S. data indicating an easing in inflation and that’s good enough for the swing macro players in oil to play the yo-yo game by reversing yesterday’s losses in crude.”
New York-based West Texas Intermediate, or WTI, crude settled up $1.60, or 2.2%, at $75.75 per barrel. The U.S. crude benchmark dropped 1.7% on Monday to finish at $74.15 — its weakest closing price since July 10.
London-based Brent settled up $1.13, or 1.4%, at $78.50, also for its poorest finish in a week. In the previous session, the global crude benchmark was down 1.7% at $74.15 — also its poorest closing in a week.
Crude prices tumbled in two previous sessions after China’s economic data again lagged expectations, raising questions on whether demand for oil will actually hit record highs this year if the top importer of the commodity remains in its current flux. A partial restart of halted Libyan output also added to the dour mood among crude longs.
Helping the macro trade was data showing U.S. retail sales rose by
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