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  • Oil set to continue Monday’s bounce into fresh multi-year highs.
  • US oversupply isn’t hampering prices as geopolitical concerns take center stage.

WTI crude oil continues to inch closer to 73.00 after Monday’s market recovery saw oil touch into new multi-year highs, and WTI is trading close to its highs near 72.40.

Crude oil bumped higher on Monday as broader markets rallied following headlines that the US and China have agreed to hold off on any further tariffs while the two countries continue trade negotiations. With the US-China trade tensions cooling off for now, markets reacted favorably, with risk assets and commodities recovering, with crude oil marking in new highs.

Despite oil bouncing on trade headlines, US supplies continue to plug supply lines, and if energy traders’ focus shifts from geopolitical tensions to supplies, then Wednesday’s API Weekly Crude Stock figures due at 20:30 GMT could knock crude lower if the figure comes in higher than the previous reading of 4.854 million barrels.

WTI levels to watch

With crude oil’s steady rise from February’s low at 57.88, WTI has lifted over 25% and the technical charts are steadily running out of resistance points to hamper prices. Supports sit at May’s low near 66.80 and the last swing low of 61.80, while the next resistance point could begin to form up near the 161.8 Fibonacci expansion level near 75.70.