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MTECHTIPS:- Crude futures continue extended slide, in spite of U.S. supply draw

MTECHTIPS:- Crude futures continue extended slide, in spite of U.S. supply draw

Crude futures pared earlier gains on Wednesday reversing territory in U.S. afternoon trading, amid an expected draw in U.S. stockpiles last week along with continuing gains in Saudi Arabian supply. On the New York Mercantile Exchange, WTI crude for September delivery wavered between $44.85 and $46.69 on a choppy day of trading, before closing near session-lows at $45.03, down 0.71 or 1.54% for the day. Earlier this week, Texas Long Sweet futures plunged 4% in Monday’s session to around $45 a barrel – dipping to its lowest level since mid-March. Over the last month, U.S. crude futures have fallen sharply by more than 20%. On the Intercontinental Exchange (ICE), brent crude for September delivery traded between $49.03 and $50.98 a barrel, before settling at $49.49, down 0.50 or 1.00%. The spread between the international and U.S. benchmarks of crude stood at $4.46, up from Tuesday’s level of $4.25 at the close. In its Weekly Petroleum Status Report released on Wednesday, the U.S. Energy Information Administration (EIA) said U.S. crude inventories decreased by 4.4 million barrels for the week ending on July 31, extending a mild draw from a week earlier. At 455.3 million barrels, U.S. crude oil inventories remain near levels not seen for this time of year in at least the last 80 years. Total motor gasoline inventories, meanwhile, increased by 0.8 million barrels for the week to remain near the middle of the average range. As the summer driving season nears its conclusion, refineries operated at 96.1% of their operable capacity last week as gasoline production increased last week to an average of 10.0 million barrels per day. U.S. crude futures extended gains from earlier in the morning session immediately after the release, before falling sharply soon after as investors locked into profits.
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