By Adedapo Adesanya
Major oil prices dropped into the second consecutive day on Tuesday after losing most of its gain as weak Chinese industrial data slowed progress in the US-China trade deal.
On Tuesday, expectations for a rise in the United States crude inventories and wane in optimism over a US -China trade deal saw oil prices drop further.
During the trading session, price of the Brent crude oil went down by 12 cents or 0.2 percent to trade at $61.13 per barrel, while price of the West Texas Intermediate (WTI) crude lost 38 cents or 0.68 percent to sell at $55.43 per barrel.
The depreciation followed a poll conducted by market analysts at S&P Global Platts and this expects the Energy Information Administration (EIA) to reveal a rise of 2.5 million barrels in crude stockpiles for the week ended October 25.
The American Petroleum Institute (API) was supposed to release its weekly report on U.S. petroleum supplies late Tuesday (yet to be released as at time of report) while the EIA will follow with theirs on Wednesday.
Oil futures like Brent had risen by more than 4 percent last week supported by a drop in US inventories and the promise in the US – China trade dispute which had been telling on prices for months because of concerns it has on economic growth and demand.
However, despite optimism expressed by both camps in recent weeks, oil prices couldn’t hold much as investors are losing faith on a likely outcome soon.
Analysts see investors shifting their attention to the prospect of deepening the supply cut that has supported prices as the Organisation of Petroleum Exporting Countries (OPEC) and its allies meet in Vienna, Austria on December 5 – 6 to discuss how they can sustain the global market in 2020.
Dipo Olowookere