The U.S. Energy Information Administration (EIA) revealed on Wednesday that crude inventories fell by 4.512 million barrels in the week ended August 7. Economists had forecast a decrease of 2.875 million barrels.

At the same time, gasoline stocks dropped by 0.722 million barrels, while analysts had expected a decline of 0.674 million barrels. Distillate stocks decreased by 2.322 million barrels, while analysts had forecast a gain of 0.357 million barrels.

Meanwhile, oil production in the U.S. reduced by 300,000 barrels a day to 10.700 million barrels a day.

U.S. crude oil imports averaged 5.6 million barrels per day last week, down by 389,000 barrels per day from the previous week.

• Expects oil prices in H2 to continue to be impacted by concerns over the second wave of coronavirus infections and higher global inventories
• Says H2 outlook points to need for continued efforts to support market rebalancing through OPEC+ production adjustments
• Expects 2021 oil demand to grow by 7 mbpd but notes that large uncertainties prevail and may result in negative impact going forward
• Cuts forecast for global demand for OPEC's crude by 400,000 bpd in 2020 and by 500,000 bpd in 2021, partly due to higher non-OPEC supply
• Says OPEC's July output grew by 980,000 bpd to 23.17 mbpd, while compliance slipped to 97%

FXStreet notes that Brent Crude Oil is struggling to extend its rally. The black gold is trading around the $45 level and could see a rise towards the 200-DMA at $47.05 which is expected to cap. On the flip side, support is seen at $41.38, strategists at Credit Suisse apprise.

“Brent Crude rally continues to struggle to extend but we continue to give the upside the benefit of the doubt for now though with resistance seen next at the 200-day average at $47.05, which we look to then cap. A direct and closing break can see resistance next at the 61.8% retracement of the Q1 fall at $50.45.”

“Key support remains seen at $41.38/32, removal of which would see a near-term top established to warn of a fall back to $37.01, potentially $33.62.”

“Weekly RSI momentum continues to hold key support for now. Below though would mark an important top.”

FXStreet notes that gold has surged around $60 during the early European session and spiked to fresh daily tops, near the $1935-37 region after an early slide to the $1862-63 region, or three-week lows. Bart Melek, Head of Commodity Strategy at TD Securities, believes the correction represents a second opportunity to get on the precious metal bandwagon.

“Real rates are now rising along with nominal yields due to stimulus optimism and risk appetite, with the USD also off its lows. Given that the US economy will continue to positively respond to an additional trillion dollars worth of fiscal stimulus and continued Fed measures, it is quite likely that rates and the dollar may see some better days into 2020. This, along with profit-taking by the very active retail investors and COMEX margin increases should see gold consolidate lower.” 

“Given the technicals and the fundamentals, it would not be surprising to see spot gold trend down to around $1890/oz and silver at around $22/oz, before hitting new records.” 

“Before the complex hits new highs ($2,100+, $30+), there will need to be confirmation that the Fed will indeed suppress yields, consider average inflation targeting and there are signs that inflation may move higher. At the same time, markets will want to see if monetization of debt is in the cards, before talk of these levels becoming sustained is credible. TD securities projects an average gold price of $2,100/oz in Q4-2021 and $30/oz silver price during the same period.”