Crude-oil futures settled lower Wednesday, with West Texas Intermediate ending five sessions of gains as concerns over tightening oil-storage capacity again took over sentiment.
That was despite a smaller rise in US crude stocks and a fall in domestic production as output caps started taking hold.
The build-in weekly U.S. crude inventories reported by the Energy Information Administration (EIA) was smaller than anticipated, while the Energy Department continued to buy oil for the Strategic Petroleum Reserve (SPR).
The EIA reported a rise of 1.7 million barrels in the SPR to 637.8 million barrels last week. US crude inventories rose 4.6 million barrels for the week ended May 1. The figures which excludes changes in the SPR was the 15th consecutive weekly rise but was smaller than the what the market had forecast at around 7 million barrels.
Crude stocks at the Cushing, Oklahoma storage hub rose about 2 million barrels for the week.
Domestic crude production totaled 11.9 million barrels a day, down 200,000 barrels a day, the EIA said.
West Texas Intermediate crude for June delivery on Nymex, lost 57 cents, or 2.3%, to settle at $US23.99 a barrel.
In Europe, the July Brent crude contract fell by $US1.25, or 4%, at $US29.72 a barrel.
Meanwhile, a stronger US and the $US1,700 an ounce resistance level have again conspired to push gold down.
Comex gold prices settled with a more than 1% loss on Wednesday as the greenback strengthened and the reopening of some economies around the world reduced the need for safe-haven bullion.
June gold fell $US22.10, or 1.3%, to settle well under the $US1,700 level at $US1,688.50 an ounce after it edged down by 0.2% on Tuesday.
It seems the metal can’t break decisively above the $US1.700 an ounce level and continue upwards. Something always seems to tug it back under.
“Gold prices just can’t shake off reopening momentum,” said Edward Moya, senior market analyst at Oanda quoted by Marketwatch.
“Despite expectations that COVID-19 deaths could rise to 3,000 a day next month, investors are staying optimistic as new cases are not spiking,” said Moya, in a market update.
Moya said gold should see strong support come from the $US1,650 level in the short-term and should still target $US1,800 over the next couple of months.
Comex July silver fell 9.5 cents, or 0.6%, at $US15.015 an ounce, after it rose 2.1% on Tuesday.
Comex July copper settled at $US2.347 a pound, up 0.6%.
Meanwhile, the price of 62% Fe iron ore fines delivered to northern China edged up 31 cents to $US84.35 a tonne.
