DTN Oil Update

Karim Bastati
DTN Analyst

VIENNA (DTN) -- Oil prices softened Tuesday morning, erasing gains from the previous trading session. U.S. President Donald Trump on Tuesday signed an executive order postponing the institution of trade-prohibitive tariffs on U.S. imports of Chinese goods by another three months to Nov. 10.

NYMEX-traded WTI for September delivery fell $0.46 to trade near $63.50 bbl, and ICE Brent for October delivery slid $0.36 to $66.27 bbl.

September RBOB gasoline futures softened by $0.0053 to $2.0713 gallon, and the front-month ULSD futures contract declined by $0.0327 to trade near $2.2583 gallon.

The U.S. Dollar Index softened by 0.266 points to 98.095.

The market seemed to have largely expected a tariff hike postponement, as sentiment was less affected by the announcement than by today's U.S. inflation report showing sticky core inflation, which could lower rate cut odds. The consumer price index in July was unchanged from June at 2.7% year-on-year, while the core CPI, which excludes price volatile goods like food and energy, accelerated to 3.1% year-on-year, according to the U.S. Bureau of Labor Statistics.

The latest production statistics published by the Organization of Petroleum Exporting Countries today revealed a 335,000-bpd month-on-month output hike by the group in July. The increase was spearheaded by OPEC members Saudi Arabia and the United Arab Emirates, and DoC member Russia. The organization's market outlook continued to be at odds with those of major forecasting agencies, leaving its 2025 global oil demand growth forecast unchanged at 1.29 million bpd, and raising growth expectations for next year to 1.38 million bpd.