- WTI closed in the red for the second day in a row on Wednesday.
- The weekly EIA report showed a sharp drop in US crude oil inventories.
- Investors await fourth quarter US GDP growth data.
Crude oil prices gained traction during US hours on Wednesday and a barrel of West Texas Intermediate (WTI) touched a weekly high of $ 53.27. However, the risk averse market environment and broad USD strength forced WTI to erase its gains and close in negative territory.
Before the release of key US macroeconomic data, the WTI is fluctuating in a narrow range below $ 53 and was last seen posting small daily gains at $ 52.67.
Focus on the US GDP report.
The report released by the US Energy Information Administration (EIA) revealed on Wednesday that crude oil stocks fell by nearly 10 million barrels in the week ending January 22. However, the rally observed in WTI after this report was short-lived as investors showed no interest in risk-sensitive assets.
Meanwhile, the Concerns about an unstable recovery in oil demand appear to have resurfaced And China is reportedly looking to restrict travel amid the growing number of coronavirus infections ahead of the Lunar New Year holidays.
Later in the session, the advanced estimate from the US Bureau of Economic Analysis for fourth-quarter Gross Domestic Product (GDP) growth will be seen as a new driver. The US economy is considered to have expanded by 3.9% annually and a better than expected reading could help WTI retest the $ 53 in the second half of the day.
Technical levels
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