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Crude oil futures rose for the first time in five sessions on Thursday, bouncing from their lowest levels since January after a selloff sparked by a downward revision in U.S. payrolls.
Oil fell on Wednesday following a sharp revision of benchmark jobs data by the Bureau of Labor Statistics, which said the U.S. economy created 818K fewer jobs in the 12 months ending in March 2024 than previously estimated.
A “small correction was necessary to fix the excessive selling seen earlier in the week,” although the underlying trend for oil is still negative, Manish Raj, managing director at Velandera Energy Partners, told MarketWatch.
Yesterday’s report of a 4.6M barrel draw in U.S. crude stockpiles and a 560K barrel decrease at Cushing were “both good fundamental reasons to reverse direction and trade higher,” Mizuho’s Robert Yawger said, adding that the fading likelihood of a ceasefire deal between Israel and Hamas also should support crude, “but the real reason the market is trading higher today is because specs ran out of downside momentum.”
Federal Reserve Chair Jerome Powell’s Friday speech at Jackson Hole will be in focus, and “any confirmation around lower rates in September by the Fed chair may offer Brent a boost, pushing prices back above $78,” FXTM manager of market analysis Lukman Otunuga told MarketWatch, but if the Fed comes out “less dovish than expected with little insight on future U.S. rate cuts, oil bears could be empowered to drag prices below $75.”
Front-month Nymex crude (CL1:COM) for October delivery settled +1.5% at $73.01/bbl, and front-month October Brent crude (CO1:COM) also ended +1.5% to $77.22/bbl.
Meanwhile, front-month September Nymex natural gas (NG1:COM) finished -5.7% to $2.053/MMBtu, after the Energy Information Administration reported U.S. supplies rose by a greater than expected 35B cf last week.
ETFs: (NYSEARCA:USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (USOI), (UNG), (BOIL), (KOLD), (UNL), (FCG)
India surpassed China as the world’s biggest importer of Russian oil last month, Reuters reported, a result of Western sanctions causing the rerouting of oil flows as well as tepid demand in China.
Russian crude comprised a record 44% of India’s overall imports in July, rising to a record 2.07M bbl/day, up 4.2% from June and 12% more than a year ago, Reuters said, topping China’s oil imports from Russia of 1.76M bbl/day from pipelines and shipments.
Indian refiners have been benefitting from Russian oil sold at discounts after Western countries imposed sanctions against Russia and curbed their energy purchases in response to the invasion of Ukraine; China has been one of the largest buyers of Russian oil, but demand has declined over time.
