Oil prices gain ground as dollar dips ahead of US inventory data

Oil futures rose nearly 1% in Asian trade with US crude off January 26 lows, while Brent climbed from February 18 lows, as the dollar index backed off July 28 highs. 

It comes ahead of a batch of US data that include US crude inventory data, that might show a surplus of 0.3 million barrels last week, adding to a 5.5 million increase in the previous reading. 

As of 06:07 GMT, US crude futures due in September rose 0.56% to $87.59 a barrel, while Brent futures rose 0.64% to $93.36 a barrel, as the dollar index shed 0.07% to 106.38. 

From the US, retail sales are expected up 0.1%, slowing down from 1% in June, while core sales are expected down 0.1%. 

Federal Reserve Governor Michelle Bowman is due to speak about technology, innovation, and financial services at the VenCent Fintech Conference, in Arkansas, later today. 

The Fed will also release its last meeting's minutes, at which it hiked interest rates by 75 basis points from 1.75% to 2.50% as expected. 

Two-year and five-year treasury yields curves remain reversed, in an ominous sign for an upcoming depression in the US economy.

Otherwise, a party of US lawmakers have arrived at Taiwan to discuss relations with Taiwanese government and investments.

China continues to condemn such moves and developing relations between US and Taiwan, and has already begun threatening military actions around Taiwan as a threat.

Otherwise, China continues to face a very stubborn Covid 19 wave that continues to impede growth, with World Health Organization reporting 585.05 million global infections worldwide so far, with the death toll at 6.425 million.

Baker Hughes data showed US oil rigs rose by 3 to 601 rigs, while rising in July for the 24th month in a row, with US output stabilizing at 12.1 million bpd, the highest since April 2020.

US output remains down a million bpd, or 8% from record highs at 13.1 million bpd in March 2020.