Oil opens August on the downside, WTI in play below $70

• Oil prices faltered in July, shedding value in crude’s worst month in two years.
• WTI traders continue to be vexed by US oil supplies, which are swinging between expansion and contraction at irregular intervals.

US stockpiles of crude oil are once again sending oil prices in another direction, with the American Petroleum Institute (API) showing that US reserves of crude oil barrels once again rose by 5.6 million barrels in just a week, wiping out previous contractions in supply stocks and pushing oil prices back into recent lows, with WTI prices back into 68.40.

Saudi Arabia recently suspended shipments through the Bab al-Mandeb Strait after attacks on oil tankers, a move which threatened to constrain supply lines across Asia and Europe, but the Yemeni Houthis who were responsible for the initial attacks have stated that they are willing to halt attacks in the Red Sea, allowing Saudi Arabia the chance to quickly send oil shipments back through the critical canal.

Oil prices suffered their worst month in over two years in July, with WTI prices slipping from multi-year highs of 75.35 per barrel back below the 69 critical technical level.

WTI Crude levels to watch

Despite recent price squeezes, namely from the OPEC energy mafia increasing production limits, long-term charts have oil still in a dedicated uptrend, with Daily candles showing crude prices still managing to squeeze further gains from successive higher lows, and bulls will be looking to clip back over the last swing high near the key 70.00 level to take another run at 2018’s highs of 75.35, while oil traders on the short side will be looking for a drop below July’s bottom of 67.00.