WTI retreats slightly from highs after EIA data, still up more than 2.5% near $51.30
- Crude oil stocks in US rose 7.5 million barrels in week ending February 7th.
- Growth rate of new coronavirus infections start to decline.
- OPEC lowers its forecast for global oil demand growth in 2020.
Crude oil prices rose sharply on Wednesday amid easing worries over the potential negative impact of the coronavirus outbreak on the global oil demand. The latest figures reported by China showed that the growth rate of new infections fell to its lowest level since late January and the recovery rate from infections rose to 10.6% from 1.3% to boost the market sentiment.
The barrel of West Texas Intermediate advanced to its highest level in six days at $51.72 before erasing a small portion of its gains following the US Energy Information Administration's (EIA) weekly oil market report. As of writing, the WTI was trading at $51.25, adding 2.65% on a daily basis.
EIA data caps WTI's gains
Commercial crude oil inventories in the US rose 7.5 million barrels in the week ending February 7th, the EIA reported. This reading came in much higher than the market expectation for an increase of 3 million barrels.
Earlier in the day, the Organization of the Petroleum Exporting Countries (OPEC) announced that it lowered its forecast for 2020 global oil demand growth by 230,000 barrels per day (bpd) to 0.99 million bpd. "The coronavirus outbreak adds to uncertainties for the oil market in 2020," OPEC noted in its monthly report and added that they need "continuous monitoring." Nevertheless, crude oil preserved its bullish momentum despite OPEC's cautious outlook.
Meanwhile, markets are still waiting for Russia and Kazakhstan to decide whether they will agree to deepen the oil output cut as recommended by OPEC+ Joint Technical Committee (JTC) last week.
Technical levels to watch for