- WTI prices above $84, bulls still capped at $84.50.
- Fears of a global recession and weaker Chinese demand weighed on crude prices.
- US oil trade values unexpectedly declined.
WTI futures trade without a clear direction on Wednesday, despite the unexpected decline in US oil inventories. West Texas Intermediate pulled back to session lows of $82.60 earlier today before attempting to trim losses, though recovery attempts were limited below $84.50.
Oil Prices Suffer Amid Global Recession Fears
Crude oil prices have depreciated by around 10% in the past two weeks, amid a combination of an increasingly negative global economic outlook and fears of a drop in Chinese demand.
The Chinese government has delayed the publication of the main indicators expected for this week, including the GDP for the third quarter, which was due to be published on Wednesday. This decision has been taken negatively by the market and has increased doubts about China’s economic momentum and its possible impact on oil demand.
In addition, US President Joe Biden has confirmed his commitment to continue releasing crude from the country’s oil reserves, which has increased negative pressure on prices.
Against this background, the unexpected decline in US commercial oil inventories has failed to boost crude oil prices. The EIA reported early on Wednesday a 1.725 million drop in inventories in the week ending Oct. 14, versus market expectations for a 1.38 million rise.
Technical levels to watch
Source: Fx Street
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