- Prices of WTI climbed to fresh 2019 tops near $55.60.
- OPEC+ output cuts, US sanctions support prices.
- US oil rig count dropped by 15 to 847 US active oil rigs.
Prices of the barrel of t he American reference for the sweet light crude oil are struggling for direction at the beginning of the week, now dropping to sub-$55.00 mark after climbing as high as the $55.70 earlier in the day.
WTI puts the $55.00 mark to the test
WTI is looking to stabilize around the $55.00 mark after briefly testing new yearly highs in the $55.70 region during early trade, always sustained by ongoing OPEC+ oil output cuts, US sanctions against Venezuelan oil exports and another drop in US oil rig count.
In this regard, driller Baker Hughes reported on Friday that oil rig count went down by 15 during last week, taking the total US active oil rigs to 847. This news added to the already positive sentiment following the EIA weekly report, where US oil supplies rose less than expected.
In addition, the recent progress made in the US-China trade negotiations coupled with positive comments from President Trump over the weekend have been also supporting prices. It is worth mentioning that Trump and Xi Jinping will meet again in Vietnam on February 27-28 to resume talks.
What to look for around WTI
Crude oil prices clinched fresh YTD peaks further north of the $55.00 mark earlier in the session. As always, the current OPEC+ output cut deal in combination with supply disruptions from Venezuela and Libya and the continuation of US sanctions against Iranian exports should remain supportive of higher oil prices. On the flip side, omnipresent concerns over a global slowdown, particularly in China, could remove some tailwinds from any sustainable bullish attempt.
WTI significant levels
At the moment the barrel of WTI is retreating 0.43% at $54.93 facing the next support at $53.40 (10-day SMA) followed by $52.52 (21-day SMA) and then $51.13 (low Jan.28). On the upside, a surpass of $55.59 (2019 high Feb.4) would open the door to $58.00 (high Nov.18 2018) and finally $58.77 (100-day SMA).
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