The benchmark for US crude oil, Western Texas Intermediate (WTI), is now trading at about $87.00 so far on Thursday. The US crude oil inventory continues to be depleted, and WTI prices are on the rise as a result of Saudi Arabia and Russia’s voluntary supply cuts.

The American Petroleum Institute (API) reported that US crude oil stockpiles decreased by 5.521 million barrels from the previous week’s 11.486 million barrels.

Furthermore, the two biggest oil exporters in the world—Saudi Arabia and Russia—announced that they would continue to reduce oil production through the rest of 2023. The activities increased WTI prices, which have been climbing over the past few weeks. Nevertheless, the reduction will bring Saudi Arabia’s daily oil production closer to 9 million barrels in October, November, and December. The reduction will be assessed every month. Alexander Novak, the deputy prime minister of Russia, announced that the country would cut its exports by 300,000 barrels daily through the end of 2023.

However, as China is the world’s top oil importer, concern over an economic downturn there may limit the rising potential of the WTI. Oil markets are waiting for new momentum from China’s trade statistics. According to a Caixin report from earlier this week, the Chinese services Purchasing Managers’ Index (PMI) decreased from 54.1 in July to 51.8 in August.

Markets anticipate that the Federal Reserve (Fed) will maintain interest rates above 5% for a longer time. Market participants predict that the Fed will raise interest rates by 25 basis points (bps) for the full year, according to the World Interest Rate Probabilities (WIRP) tool. It’s important to keep in mind that rising borrowing costs might slow the economy and reduce demand for oil.

Oil traders are anticipating the release of the EIA Crude Oil Stocks Change data for the week ending September 1 at 15:00 GMT on Thursday. These events could have a significant impact on the price of WTI expressed in USD. The data will serve as a guide for oil traders as they look for trading opportunities around WTI levels.

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