WTI capped below $ 54, US inventory build weighs

Oil futures on NYMEX paused its 2-day rally and now consolidate in a narrow range, as bearish EIA inventory report continue to weigh on investors’ minds.

The US crude oil inventories increased by an unexpected 6.5 million barrels to 494.76 million barrels, the Energy Information Administration (EIA) report showed. Markets had expected an increase of 3.3 million barrels.

However, the losses remain capped as a broadly weaker US dollar, in wake of a non-event Fed, continues to lend support to the USD-denominated commodity. Currently, WTI trades modestly lower at $ 53.75, unable chew offers located just shy of $ 54 mark.

Meanwhile, a latest Bloomberg survey revealed that the US exports are expected to surpass production in four OPEC nations in 2017.

WTI technical levels

A break above $ 54 could yield a test of $ 54.32 (daily R1). While a breach of support at $ 53 (round figure) would expose the 20-DMA support at $ 52.75.