WTI seesaws around $122.00 as API inventories battle risks from Russia-Ukraine stand-off

• WTI probes three-day uptrend while easing from 14-year top.
• API inventories marked surprised build for the week ended on March 04.
• Western leaders ban Russian energy imports, sentiment improved after Ukraine retreated from NATO membership goals.
• China inflation, EIA stockpile data may offer intermediate directions but risk catalysts are the key to follow.

WTI crude oil buyers take a breather at around $122.50 during the initial Asian session on Wednesday, after refreshing a 14-year high during the latest three-day uptrend.

The weekly oil industry stockpiles from the American Petroleum Institute (API) seem to have joined the receding geopolitical fears from Ukraine to test the oil buyers of late. On the same line were the sanctions to import Russian oil and gas from the US and the UK. However, Moscow’s readiness to retaliate and hidden dissatisfactory from Kyiv's latest moves keep oil buyers hopeful around the highest levels last seen during 2008.

That said, the latest API Weekly Crude Oil Stock reversed the previous -6.1M figures with a 2.811M mark during the week ended on March 4.

“In a nod to Russia, Ukraine is reportedly no longer insisting on NATO membership,” reported AFP on Tuesday. The news also joins the confirmation of the first humanitarian corridor in Ukraine to tame the fears of an oil supply crunch and tested WTI bulls. However, Russia may not cheer Kyiv’s intention to dump NATO membership goal as Moscow may fear the enemy to join the European Union (EU), which in turn demolishes President Vladimir Putin’s unsaid target of putting Kremlin-controlled leader in Ukraine.

Elsewhere, the US and the UK announced the ban on importing oil land gas from Russia, Britain did it in a phased manner due to its more reliance on Moscow’s energy import. It’s worth noting that the EU is also on the same line. In response, Russian President Vladimir Putin as he bans the export of products and raw materials out of the Russian Federation until December 31.

It should be observed the chatters surrounding Iran’s denuclearization and geopolitical tensions in Libya also favored oil buyers of late. Additionally, OPEC Secretary General Barkindo recently mentioned that there is no shortage of oil, which in turn tests the energy bulls.

Given the mixed news and the market’s wait for more catalysts, the US 10-year Treasury yields fail to extend the previous day’s positive performance around 1.84% whereas the S&P 500 Futures remain steady at the latest.

Moving on, China’s Consumer Price Index (CPI) and Producer Price Index (PPI) for February, expected 0.8% and 8.7% versus 0.9% and 9.1% respectively, will direct immediate moves of the WTI crude oil prices. Following that, the weekly official inventory data from the US Energy Information Administration (EIA), expected -0.833M versus -2.597M, will be important to watch. Above all, headlines from Russia and Ukraine, as well as Iran’s denuclearization and geopolitical tussles in Libya, will be important to watch.

Technical analysis

A higher-high formation keeps WTI bulls directed towards the previous record top near $148.00, marked in 2008.