WTI Trades With Modest Losses Around $73.25 Area, Down Nearly 0.50% For The Day -

WTI Trades With Modest Losses Around $73.25 Area, Down Nearly 0.50% For The Day

Jan 28, 2025Jeremy ParkinsonFinance0

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WTI struggles to capitalize on the overnight bounce from a multi-week top.

Worries that a global trade war could dent demand weigh on Crude Oil prices.

A smaller-than-expected rise in US inventories helps limit any further losses.

West Texas Intermediate (WTI) US Crude Oil prices tick lower during the Asian session on Wednesday and erode a part of the previous day’s modest recovery gains from a nearly three-week low. The commodity currently trades around the $71.00 mark, down over 0.25% for the day, and seems vulnerable to prolonging its recent downfall witnessed over the past two weeks or so.Investors remain concerned that US President Donald Trump’s threat to impose trade tariffs against Canada, China, and Mexico by February 1 could dent fuel demand. Moreover, the official Chinese PMIs released on Monday pointed to sustained weakness in the world’s second-largest economy and the world’s biggest oil importer, which, in turn, is seen undermining the black liquid. Crude Oil prices are also pressured by Trump’s planning for increased energy production in the US and demand that the Organization of Petroleum Exporting Countries increase production to bring down prices.The downside in Crude Oil prices, however, remains cushioned in the wake of a slightly smaller-than-expected build in US inventories. In fact, the American Petroleum Institute reported on Tuesday that US oil inventories grew by 2.86 million barrels in the week to January 24 and raised expectations for a similar trend from the official inventory data, due later this Wednesday. Traders also seem reluctant to place aggressive directional bets and opt to wait on the sidelines heading into the key central bank event risk – the outcome of the highly-anticipated two-day FOMC monetary policy meeting. The Federal Reserve (Fed) is widely expected to stand pat and stick to its hawkish stance. This assists the US Dollar (USD) to preserve the overnight recovery gains from over a one-month low and might continue to act as a headwind for the commodity. Meanwhile, the Fed’s policy outlook will play a key role in influencing the near-term USD price dynamics and provide some meaningful impetus to Crude Oil prices later during the US session.More By This Author:Pound Sterling Price News And Forecast: GBP/USD Fails To Stabilize Above 1.2500 USD/CAD Sticks To Modest Gains Above 1.4400, Over One-week Top Ahead Of US Data Gold Price Extends Its Consolidative Price Move On Stronger USD, Trade War Fears