WTI extends correction, clings to modest daily gains above $69.50
- Crude oil is edging higher after closing in the positive territory on Thursday.
- Geopolitical tensions continue to heighten in the Middle East.
- Focus shifts to Baker Hughes' weekly US Oil Rig Count data.
Crude oil prices suffered heavy losses in the first half of the week and the barrel of West Texas Intermediate (WTI) lost nearly 8% during that period to touch its lowest level since July 21 at $67.59. However, the WTI managed to stage a rebound on Thursday and continues to push higher on Friday. As of writing, the pair was up 1% on the day at $69.75.
Demand dynamics hurt WTI
Earlier in the week, renewed concerns over the rising number of coronavirus cases in Asia crippling the energy demand recovery weighed on crude oil prices.
Commenting on oil's recent decline, "growing worries surrounding new mobility restrictions in China tied to the Delta variant, OPEC+ supply increases for August and weakening export activity all helped to drive WTI crude down," said Bart Melek, Head of Commodity Strategy at TD Securities.
Meanwhile, the data from the US revealed that crude oil stocks increased by 3.6 million barrels in the last week of July, compared to market expectation for a decrease of 3.1 million barrels.
On the other hand, rising tensions between Israel and Iran seems to be helping WTI limit its losses. Later in the day, Baker Hughes Energy Services' weekly US Oil Rig Count data will be looked upon for fresh impetus.
Technical levels to watch for