Commodities: Crude bounces off lows as EIA data shows fall in US inventories
Crude futures bounced off earlier lows on Wednesday afternoon as US Energy Information Administration (EIA) data showed a surprise fall in inventories last week.
At 15:42 BST, Nymex-priced West Texas Intermediate was up 0.24% to $49.68 and Intercontinental Exchange-traded Brent was down 0.08% to $52.06.
About 20 minutes earlier, WTI and Brent were down by 0.79% and 1.04%, respectively.
In between, the keenly anticipated government EIA data revealed crude stores dropped by 3.6m barrels in the week to 21 April, versus market views for a decrease of 1.7m barrels.
This followed American Petroleum Institute (API) data the night before showing crude stores rose by 897,000 barrels in the week to April 21, defying expectations of a fall of 1.7m barrels.
Michael Hewson, chief market analyst at CMC Markets UK, said oil prices were initially under the cosh after the API numbers.
"Doubts about the ability of OPEC and non-OPEC members to coalesce around an agreement to extend the output freeze, when they meet in just over a months’ time, was serving to act as a significant anchor on the price," he said.
"This afternoons EIA inventories helped unwind some of that downward pressure with a bigger than expected draw of 3.64m barrels," said Hewson.
"Some of that effect may well be offset by a build in gasoline inventories, but this was expected."
Meanwhile, at about 15:25 BST, on Comex, gold was down 0.28% to $1263.6 an ounce. Silver fell 0.9% to $17.5 an ounce, and copper rose 0.23% to 259.7 cents a pound.
"Gold has found support around $1262 thanks to 6-week rising support," said Mike van Dulken, head of research at Accendo Markets.
Hewson added that gold prices had continued to come under pressure, "hitting one-week lows as the more benign risk environment, along with expectations of a move away from dovish central bank rhetoric serves to undermine the attraction of the yellow metal."
Lukman Otunuga, research analyst at FXTM, said renewed appetite for risk in the market had left safe-haven investments in the dust.
"Sellers have exploited the risk-on trading environment to install heavy rounds of selling on the yellow metal with prices hovering around $1260 as of writing," he said.
"Although geopolitical tensions and overall uncertainty may support the yellow metal in the longer term, short-term bears could reclaim control below $1260."
"A breakdown and daily close below $1260 should encourage a further decline towards $1240. In an alternative scenario, bulls need to keep above $1260 for a further incline back towards $1280."
On London Metals Exchange, three-month industrial metals were mostly ahead. Copper was up 0.9%, aluminum rose 0.87% and zinc added 0.06%. Tin, however, fell 0.13%.