Oil Gains on US PPI, EIA data

Crude oil market is busy digesting latest signals on the level of growth demand. Volatility has brought about oil prices gain of 1% on Wednesday. The latest signals include US crude inventory data, inflation indicatiors and the impact of China’s COVID lockdowns.

As of 3:33 p.m. EST on Wednesday, Brent crude was trading up $0.53, at $93.73, for a 0.60% gain on the day. WTI was trading up $0.83, at $88.14, for a 0.95% gain on the day. At the time of writing Brent trades at $93.85 per barrel versus Tuesday’s closing price $92.86, as WTI crude trades at $89.05 versus Tuesday’s closing price at $88.48.

Oil prices appear to be reacting, in part, to Wednesday’s release by the Bureau of Labor Statistics of the Producer Price reading which injected some optimism into markets that inflation may not become entrenched.

The PPI showed a drop in producer prices that signaled some supply chain issues might be easing. Lending upward buoyancy to WTI prices is the Energy Information Administration’s (EIA) inventory report showing a build of 2.4 million barrels for the week to September 9, compared to an 8.8-million build for the previous week.