Maintaining Downside Bias

Brent crude has continued to track lower in the first part of Friday trading. We are around $74.50/bbl currently, just above session lows of $74.34/bbl. We have lost a further ~0.70% so far today (Wed/Thur trade we lost over 3%), while for the week we sit slightly down on closing levels from last Friday. Next support would be seen at $71.28/bbl (May 4 low). WTI is following a similar trajectory, last near $70.40/bbl.

• Demand concerns from both China and the US have weighed on the outlook this week. Data momentum has faltered in both economies over recent sessions.
• There is evident in terms of other commodities, with metals notable underperformers this week, although copper and iron ore are firmer today.
• On the supply side., Iraq is planning to resume oil exports (450k barrels per day) to the market through the port of Ceyhan in Turkey from Saturday. This appeared to offset reports that the US will start refilling its Strategic Petroleum Reserves after June.