OIL: Crude Holds Onto Gains As Watches Global Events

Oil rose 1.8% on Wednesday and has held onto most of these gains during today’s APAC session as the market awaits US August CPI and further geopolitical developments in Europe and the Middle East, which could cause some market volatility. WTI is down 0.2% to $63.52/bbl, close to the intraday low, after reaching $3649.09 earlier. Brent is 0.2% lower at $67.35/bbl after a high of $67.62. The USD index is slightly higher.

• After Russian drones violated Poland’s airspace, it asked NATO to invoke Article 4, the clause allowing members to report security concerns to the group. US President Trump reacted on Truth Social saying “What’s with Russia violating Poland’s airspace with drones? Here we go!”.
• The EU had already been looking at further sanctions on Russian banks and energy and the incursion into Poland makes their implementation more likely with Trump saying the US will follow the EU.
• OPEC and the generally less optimistic IEA both publish their monthly reports including market projections today. The IEA has been expecting a record global surplus in 2026.
• Headline CPI is forecast to rise 0.2pp to 2.9% y/y in August while core is expected to be stable at 3.1% y/y, well above the Fed’s 2% target (see Hidden PDF).
• In addition to the CPI, US August real earnings, jobless claims and August budget print. The ECB is expected to leave rates unchanged at its decision later.