(Bloomberg) — Oil was steady near a six-week low as traders waited for fresh clues on market balances, including the outlook for US stockpiles.
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Global benchmark Brent held above $82 a barrel after shedding more than 3% over the previous two sessions, while West Texas Intermediate was near $78. The drop came amid sales by algorithmic traders, which has exacerbated the downward pressure driven by concerns over Chinese demand.
The industry-funded American Petroleum Institute will issue its estimate for weekly shifts in US inventories later on Tuesday, followed by a government breakdown the following day. Nationwide crude stockpiles have dropped for the past three weeks, hitting the lowest since February.
Crude remains higher year-to-date, helped by OPEC+ supply cutbacks and expectations for lower US interest rates, probably from September. Political risks remain front and center as investors weighed the implications of Joe Biden dropping his presidential reelection bid.
“Lingering Chinese demand concerns following recent poor data continue to weigh on oil,” said Warren Patterson, head of commodities strategy at ING Groep NV in Singapore. “OPEC+ cuts should ensure that the market tightens in the current quarter. However, how tight it will get will depend on how Chinese demand evolves.”
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Read More: Oil Holds Drop as Traders Track Chinese Demand, US Stockpiles