On Wednesday, oil prices are mostly steady due to the data implying a smaller-than-expected fall in the United States crude inventories. And it countered support from beliefs for a trade deal between the U.S. and China.
Then, the Brent crude futures dropped 18 cents, and it trades at $61.96 a barrel.
Aside from that, the U.S. West Texas Intermediate crude was down 5 cents at $53.85 a barrel. However, it set its highest daily rise since early January on Tuesday.
Last week, the United States crude stocks fell 812,000 barrels to 482 million after weeks of growth. The fall was smaller compared to the analysts’ expectation of a 1.1 million barrel reduction. And according to PVM, the price rally weakened as concerns over the growing U.S. oil stockpiles return to the fore.
Meanwhile, the U.S. crude stockpiles estimation from the U.S. Energy Information Administration is due on Wednesday. And President Donald Trump extends some support by stating preparations to meet Chinese President Xi Jinping starts. Trump expects to meet the Xi next week at the G20 summit held in Osaka, Japan.
Looking back, the dispute between the United States and China began after Washington accused China of withdrawing away from previously agreed commitments. And since then, communication between the two sides became limited. Also, Trump continues to threaten to raise more tariffs on Chinese imports.
Meanwhile, Mario Draghi, European Central Bank President, offered a surge. And the central bank would relieve policies again if inflation did not advance.
The Middle East and The United States
After the tanker attacks, tensions in the Middle East continues to escalate. Since last Thursday’s attacks, concerns over a confrontation between Iran and the United States went high. And Washington is accusing Tehran, which they denied instantly.
In addition to that, Trump declared that he prepared to use military action to prevent Iran from having a nuclear bomb. However, it is unknown whether he would allow the use of force to guard Gulf oil supplies.
The United States is stationing another 1,000 troops to the Middle East. The movement is the defensive response of Washington in the concerns about a threat from Iran.
Gold in Trade War
On Wednesday, the price of gold dropped as the aspiration of a trade agreement between the U.S. and China rose, and dovish European Central Bank elevated riskier assets. At the same time, investors are waiting for the U.S. Federal Reserve’s monetary policy decision in the day.
The spot price of gold slipped 0.3% at $1,342.60 per ounce. And the U.S. gold futures were also down by 0.3% to $1,346.60 an ounce.
And in the same van, the silver declined o.5% to $14.93 per ounce.
Contrarily, the platinum gained 0.2% to $800.71. Also, Palladium rose 0.8% at $1,491.80.