Pre Open US - US Oil 28 July 2023

Surprisingly, the growth in the US gross domestic product accelerated, and pending home sales in the US increased in June. This reinforces the argument for a smooth economic transition after a period of aggressive rate hikes.

Additionally, the Chinese government committed to supporting households by subsidizing spending on automobiles, household goods, tourism, and sports.

On the supply side, there are signs of tightening as evidenced by the declining US inventories and Saudi Arabia's voluntary cut of 1 million barrels per day. Commerzbank analysts emphasized that this month might have witnessed OPEC oil production reaching its lowest level since the autumn of 2021.

WTI crude oil continues the bullish trend toward the fifth week of gains. The momentum is strong and a breakout of the 80 resistance level seems close to next target at 81.3.