West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $69.40 during the early European trading hours on Wednesday. The WTI price falls as the number of vessels transiting the Strait of Hormuz shows signs of recovery amid progress toward easing Middle East tensions. The US Energy Information Administration (EIA) weekly crude oil report is due later on Wednesday.
Data from Kpler showed that around 24 commodity ships, including those that haul oil and liquefied natural gas, as well as bulk carriers, transited the Strait of Hormuz in both directions on Monday. The trend continued on Tuesday, with a supertanker reappearing in the gulf, along with a number of smaller ships. A pickup in traffic through the critical water eases fears of oil supply disruption and weighs on the WTI price.
US envoys Jared Kushner and Steve Witkoff arrived in Doha on Tuesday. A Qatari government spokesperson said they would meet the Qatari prime minister to discuss ongoing US-Iran talks and regional developments. However, there are currently no high-level meetings between the US and Iran.
Traders will closely monitor the developments surrounding US-Iran talks. Lack of progress in a peace deal or any signs of rising tensions in the Middle East could boost the black gold in the near term.
US crude oil inventories continued their downward plunge last week. According to the American Petroleum Institute (API) report, crude oil stockpiles in the US for the week ending June 26 fell by 6.072 million barrels, compared to a decline of 765,000 barrels in the previous week. The market consensus was for a decrease of 4.1 million barrels.
Traders will take more cues from the EIA weekly crude oil report due later on Wednesday. A larger-than-expected crude oil inventory draw indicates stronger demand and could lift the WTI price, while a bigger build than estimated signals weaker demand or excess supply, which might undermine the WTI price.
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