Crude oil prices are making shallow recovery attempts on Wednesday after yesterday’s decline to lows marginally above the $72 figure. The bulls refrain from more aggressive actions as market concerns over geopolitics keep increasing, fuelling fears of a decline in global oil demand.
The Trump’s trade wars threaten to derail global growth and shatter global oil consumption as a result, which is the main source of concern in the market for now. And any sign of weakening economic data in China hurts crude oil prices. Against this backdrop, signals of increasing output add to the bearish pressure. As such, the recent news of a recovery in Libyan oil production recovery above 1 million bpd served as a catalyst for sellers.
Earlier this week, Brent dropped to mid-April lows just above the $71 figure. And this level remains the immediate bearish target that could be reached in the short term as recovery attempts continue to attract sellers. The EIA will release inventory and production data later today, and another increase in crude oil stockpiles will further derail Brent’s positions.