Oil jumps on lower USD, surprised API drawdown report and an optimistic poll of oil analysts

• Oil jumps on lower USD after BOJ “Stealth Tapering”.

• Oil is also helped by surprised drawdown report from API and an optimistic poll of oil analysts.

Crude oil/WTI is now trading around 63.23, in New York session, jumps by 0.35% and well off the earlier day low of 62.51 on lower USD, surprised US crude drawdown report from API and an optimistic poll of oil analysts on Wednesday.

Also, steady US economic growth (GDP) and an uptick in private consumption may be positive for oil demand despite muted China import figure, the concern of higher US productions and report of OPEC-US shale oil producers meet on the coming Monday for any probable production cut agreement.

On Wednesday, API weekly crude oil stock came as 0.933M vs estimate of 2.700M; prior: -0.907M.

As par Reuter’s poll, oil analysts expect the price of crude to rise steadily this year but remain in a tight band dictated by US shale output growth on one side and OPEC supply restraint and high compliance level on the other side. The survey of 37 economists and analysts forecast Brent crude would average $63 a barrel in 2018, slightly higher than $62.37 projected in the previous month's poll.

Also, growing demand from Asian countries like India and China is boosting oil coupled with supply disruption from Venezuela. On Wednesday, India’s Q3 GDP was reported at 7.2%, the fastest in the world right now after some blips from Demonetization pain and that may be also supporting the oil right now despite subdued PMI data reported across the region.

Crude oil, on Tuesday, closed lower on the rally in the dollar index to a 2-week high and on IEA Executive Director  Birol's comment that current "explosive growth" in US oil production could extend beyond 2018. Crude oil prices were also undercut by expectations for Wednesday's weekly EIA oil inventories to climb +2.4 million bbl.

Oil was also under pressure on Tuesday amid reports of OPEC & US shale oil producer’s meet. As par some reports, OPEC officials will meet with US shale firms at a dinner Monday in Houston. The US, which rivals Russia and Saudi Arabia for the position of the world's largest oil producer, is not participating in cuts as its industry is represented by private producers who can be sued for collusion if they join the deal.

The meeting will be on the first day of the CERA Week energy conference in Houston. A year ago, the OPEC held unprecedented talks with fund executives and shale producers on the sidelines of the same event without any positive outcome.

Technically, Oil now has to sustain over 64.15 area for a further rally towards 64.85-66.05 zone in the coming days; else sustaining below 63.75 it may again fall to 62.40- 61.00 and 58.00 area in the coming days.