WTI corrects from six-day tops to $ 56, US rigs data eyed

• Oil downed but eyes big weekly gain amid US-China trade optimism.
• Looming Florida hurricane and declining US crude stocks support oil.
• All eyes on US Rigs Count data and trade-related news for fresh cues.

WTI (futures on Nymex) stalled its corrective slide from six-day tops of 56.89 just ahead of the 56 handle, as markets await the US data and fresh developments on the US-China trade front for the next direction.

Oil remains at the mercy of trade headlines

Despite risk-on market profile amid latest optimistic trade remarks by China’s Foreign Ministry, oil prices remain on the back foot, as investors look to take profits off the table after four straight days of gains. The black gold is on track to book over 2% gain this week.

The barrel of WTI rallied hard on Thursday, as the risk sentiment was boosted by renewed hopes of a US-China trade progress after the Chinese Commerce Ministry indicated that they seek no retaliation to the additional US tariffs that take effect on Sept 1. Further, the US President Trump announced lower levels of trade talks between both the countries.

Further, the bulls also cheered a big drawdown in the US inventories, which fell last week by 10 million barrels against expectations for a decrease of 2.1 million barrels, as reported by the Energy Information Administration (EIA).

Additionally, the prices also derived support from the report that Hurricane Dorian was approaching toward Florida that raised fears over the offshore US. crude production shutdown, as cited by Reuters.

WTI Levels to watch