Traders, for the most part, are ignoring concerns about a possible USA recession and worries about lower demand growth. Tomorrow the Department of Energy will release their weekly inventory data as well.
United States crude stockpiles plummeted by 11.1 million barrels last week as imports dropped, compared with expectations for a 2-million-barrel draw, data from the American Petroleum Institute (API), an industry group, showed.
Brent crude was down 54 cents, or 0.9%, at $58.80 a barrel by 0538 GMT, having earlier touched $58.24, the lowest since August 15. Algorithmic trading may have fueled the initial price rise, he said, adding that the government data was in line with figures reported yesterday by the industry-funded American Petroleum Institute. Gasoline and distillate stockpiles fell by more than 4 million barrels combined.
Another price positive factor is the Wall Street Journal's news report mentioning that Iran's Iran's President Hassan Rouhani rejected the possibility of meeting with President Trump as long as the US sanctioned his country. Peaking in April 2019 at 2.4 million t while falling back to 1.1 million t in June, the monthly average for the first six months of 2019 has reached 1.6 million t, up by 65% from 1H18.
"No positive developments will happen in Iran-US ties without them lifting sanctions and abandoning their hostile actions", Rouhani said in a televised speech - a day after Trump said there was a "really good chance" the men could meet in the coming weeks.
US President Donald Trump said on Monday that he believed China was honest about wanting to reach a trade deal, while Chinese Vice Premier Liu He said China was willing to resolve the dispute through "calm" negotiations.
Since ending sanctions waivers that allowed Iran's top customers to continue purchases of Iranian crude, the U.S. has sanctioned only one Chinese company for violating USA restrictions on Iran's oil sector: state-owned trading company Zhuhai Zhenrong Ltd and its chief executive Youmin Li.
The onshore RMB Yuan CNY fell 0.6% in early trade to 7.15 United States dollars, its weakest since February 2008 and its 2nd biggest 1-day drop of the month.