WTI slumps to $58.50 area after EIA report shows large buildup in crude inventories

• EIA's weekly report revealed surprise buildup in US crude oil stocks.
• OPEC left forecast for 2020 global oil demand growth unchanged. 
• Focus shifts to FOMC's updated economic projections.

Crude oil prices came under renewed selling pressure in the last hour after the weekly report published by the US Energy Information Administration (EIA) showed a surprise buildup in the crude oil stockpiles. After slumping to a fresh daily low of $58.09 with the initial market reaction, the barrel of West Texas Intermediate (WTI) recovered modestly and was last seen trading at $58.50, losing nearly 1% on a daily basis.

EIA data weighs on WTI

According to the EIA, commercial crude oil inventories increased by 0.8 million barrels in the week ending December 6th, compared with analysts estimate for a decrease of 2.75 million barrels.

Earlier in the day, the Organization of the Petroleum Exporting Countries (OPEC) in its monthly oil market report said that it left the forecast for 2020 global oil demand growth unchanged at 1.08 million barrels per day.

Investors will ve paying close attention to the FOMC announcements in the post-settlement trade on Wednesday. Although the Fed's monetary policy is unlikely to affect crude oil's valuation, the updated economic projections could provide fresh insights regarding the possibility of an economic slowdown in 2020, which could also impact the energy demand outlook. 

Technical levels to watch for