Corona Virus
Stay Safe, FollowGuidance
Fetching Location Data…
Vladimir Zernov
WTI Crude Oil

Oil Video 28.10.20.


Oil Is Under Serious Pressure Amid Fears Of New Lockdowns In Europe

The world markets are in a sell-off mode today, and oil is no exception. The main reason for this sell-off is the fear of a second wave of lockdowns in Europe.

Know where WTI Crude Oil is headed? Take advantage now with 

75% of retail CFD investors lose money

According to recent reports, France will soon issue a stay-at-home order which will tell people to stay at home except for work or essential exercise.

Meanwhile, the German newspaper Bild reported that Angela Merkel was pushing for a light lockdown from November 2. This lockdown is expected to close businesses like bars, restaurants and gyms in an attempt to contain the second wave of coronavirus.

While the upcoming lockdowns are not expected to be as strict as the lockdowns in spring, oil traders worry that they will put significant pressure on demand for oil.

At this point, it looks like oil demand will certainly suffer a blow, but the size of this blow remains uncertain. If the decline in oil demand is not as strong as feared, oil will have good chances to get back above the $40 level.

U.S. Crude Inventories Increase By 4.3 Million Barrels

Yesterday, API Crude Oil Stock Change report showed that crude inventories increased by 4.58 million barrels. Today’s EIA Weekly Petroleum Status Report confirmed that crude inventory levels have significantly increased.

According to EIA, crude inventories increased by 4.3 million barrels. Meanwhile, gasoline inventories decreased by 0.9 million barrels while distillate fuel inventories decreased by 4.5 million barrels.

Crude oil imports increased by 0.5 million barrels per day (bpd) and contributed to the increase of crude inventories. However, the main catalyst for the rapid inventory increase was the major growth of U.S. domestic production levels.

The U.S. domestic oil production grew from 9.9 million bpd to 11.1 million bpd. Finally, the rising number of U.S. oil rigs led to a major increase in domestic production levels.

It should be noted that the next week’s report may show a decline in U.S. oil production as  Hurricane Zeta forced evacuation of offshore platforms in the U.S. Gulf of Mexico.

In total, EIA published a bearish report as crude inventories increased together with the U.S. oil production. Most likely, oil will remain highly volatile in the upcoming trading sessions as topics like European lockdowns, U.S. stimulus negotiations and U.S. presidential election will keep traders busy.

For a look at all of today’s economic events, check out our economic calendar.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.