WTI retreats from $33,70 highs after EIA crude inventory report

• WTI crude oil pulls back from two-month highs after EIA crude stocks report.
• US stocks declined by 5 million barrels on the week of May 25, less than the 11 million decline expected.
• WTI oil prices remain positive after having rallied 70% over the last month.

Crude oil prices have dropped more than $1, retreating from two-month highs at $33,70, to $32.65 lows after the Energy Information Administration reported that US crude oil stocks declined by 5 million barrels during the week of May 25.

The negative reaction on front-month contracts for West Texas Intermediate (WTI) responds to the market disappointment with the EIA reading. The decline in stocks has been noticeably shorter than the 11 million barrels fall anticipated by the market consensus.

Oil prices are recovering from historic lows

From a wider perspective, crude prices remain trending higher. WTI oil has appreciated approximately 70% in one month, reaching prices near $34 after having collapsed to negative prices on late April.

The gradual increase on oil demand, as the major economies start lifting coronavirus restrictions and the OPEC+ agreement to cut production have been crucial to the price increase seen over the last weeks.

Likewise, Brent Oil prices are hovering right below $36.36, its highest price in two months, after having bottomed at $16 in late April.