Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
WTI reverses gains as a freeze deal looks unlikely at a next month’s informal OPEC meeting . WTI is currently trading at $45.8 per barrel and Brent at $2.3 per barrel premium to WTI.
Key factors at play in Crude market –
- OPEC countries have announced an informal meeting in late September when on the sideline of IEA biennial summit in Algeria. However, Iranian officials have declined to comments on whether they will join or not. Iraq has recently said that it would support initiative of a freeze.
- However, a freeze remains in doubt as Saudi oil minister said that with current price, there is less of a need to act.
- Iraq plans to sell oil through Iran.
- Oil market glut has shifted from crude oil to gasoline.
- Recent research by Rystand Energy has revised US crude reserve upwards to 264 billion barrels, more than Saudi Arabia and Russia.
- U.S. oil production has dropped to 8.6 million barrels/day and likely to drop further. It has declined more than a million barrel from the peak but up from its low of 8.43 million barrels per day.
- Active oil rigs in the US have been climbing and up more than 25 percent from its bottom.
- American Petroleum Institute’s (API) weekly report showed an increase in crude oil inventory by 942,000 barrels.
Today’s inventory report from US Energy Information Administration (EIA) will be released at 14:30 GMT.
Trade idea –
- The key happenings surrounding OPEC and Saudi Arabia have boosted oil price along with a weaker dollar, however, as of now, there are no signs that the price would break above $52 resistance area. We remain broadly committed to the downside. We expect the price to drop by another $10 per barrel.
