The market expects the American crude inventories increased by around 1 million barrels last week. Moreover, the risk of further rise in production is also high, especially amid recent signs of growing drilling activity in the country. According to Baker Hughes , the U.S. energy companies added 12 oil rigs last week, the biggest weekly increase since March. The additional negative factor for prices now is that the American refiners gear up for maintenance which increases the risk of growing inventories in the weeks ahead.
All these signals are a source of concern for oil traders, at least for now. And further signs of expanding the producers’ activity may well derail the rally at this stage. However, the fundamentals, including OPEC’s efforts, continue to support the overall in the market. Therefore, the current correction which may send Brent to $68 or lower, is still an opportunity for reentering the market. The uptrend will be threatened if OPEC countries start signaling an early withdrawal from the deal, which is unlikely.