WTI slumps to fresh multi-week lows below $57.50 despite large drop in US oil stocks

• EIA says commercial crude oil inventories in US decreased by 2.5 million barrels.
• OPEC raises 2020 global oil demand growth forecast by 0.14 million barrels per day.

Crude oil prices came under pressure during the American trading hours on Wednesday with the barrel of West Texas Intermediate (WTI) dropping to its lowest level since early December at $57.38. As of writing, the WTI was trading at $57.40, erasing 1.22% on a daily basis.

WTI extends losses after EIA data

The weekly report published by the US Energy Information Administration (EIA) on Wednesday showed that commercial crude oil inventories in the US fell by 2.5 million barrels in the week ending January 10th, compared with analysts' expectation for a drop of 474K barrels.

Although a larger-than-expected draw in commercial oil inventories is generally seen as a bullish development for oil, the fact that distillate stockpiles, which include diesel and heating oil, increased by 8.2 million barrels in the same period didn't allow the WTI to gain traction. 

In the meantime, the Organization of the Petroleum Exporting Countries (OPEC) announced that it has raised its forecast for global oil demand growth in 2020 by 0.14 million barrels per day (bpd) to 1.22 million bpd in its latest monthly report but failed to help crude oil prices stage a decisive rebound.

"OPEC+ collaboration remains essential in maintaining stability in the oil market," the organization noted.

Technical levels to watch for