Oil sits at multi-month troughs, WTI flirts with $ 40

Oil benchmarks on both sides of the Atlantic snapped a minor-bounce and traded modestly flat ahead of the European open, as investors remain wary heading towards the inventory report due to be published by the API later on the day.

WTI defending $ 40 mark

Currently, both crude benchmarks now pare gains and trade almost unchanged, with Brent managing to hold $ 42 mark, while WTI hovers just ahead of 40 barrier. Oil prices remain vulnerable going forward as oversupply worries continue to persist, with markets now awaiting fresh supply data for fresh incentives.

Moreover, the black gold remains weighed down by overproduction prevalent in crude as well as in the refining sector. While bearish crude CFTC data also keeps any recovery short-lived in oil. Speculators increased their shorts by the biggest volume on record for the US oil, dragging the net long position in WTI to its lowest since February, CFTC data showed.

Amid omnipresent supply glut fears, oil fails to find support from ongoing broad USD weakness backed by poor run of US economic data. Next of relevance for oil remains the API inventory report due to be published later today. While the official government crude reserves report published by the EIA will be released on Wednesday.