Libyan Crude Oil Output Gains

Investor sentiment was hurt after data showed Libyan output increased enough to lift monthly OPEC production for the first time in 2017. Brent crude marked its fifth straight monthly decline despite the extension of OPEC-led production cuts and expectations that US inventories would consequently fall. Data from the American Petroleum Institute showed crude stockpiles fell by -8.670 million barrels during the week ended May 26^th to 513.2 million barrels in storage compared to analyst expectations for a contraction of -2.500 million barrels.

The official US Energy Information Administration numbers are due Thursday, delayed by a day following Monday’s Memorial Day holiday. Brent futures for August delivery are mounting an upside rebound early Thursday to currently trade around the key resistance at $51.30 a barrel. However, any conclusive break below $50.00 could take prices all the way towards $48.00 per barrel over the medium-term.

Retail sales in Australia bounced back sharply in April, following a weak, weather-affected start to the year. Data from the Australian Bureau of Statistics delivered early Thursday showed that real retail sales grew 1.00% last month, easily topping expectations of a gain of 0.30% and reversing from a revised -0.20% decline in March. The increased sales in April were largely on account of a turnaround in department stores, where sales jumped 2.50%, compared to a -0.60% drop in March.

The rebound should provide some relief to the Reserve Bank of Australia, which was worried that the excessive borrowing in the booming real estate sector could depress spending elsewhere in the economy. The Australian dollar gained immediately following the release, but has since retreated after tepid Chinese manufacturing figures hurt sentiment. The AUDUSD pair is currently edging higher after crossing back above 0.7400.