Oil Price Forecast: WTI extends range play around $32 ahead of EIA data

• WTI trades choppy amid mixed market sentiment.
• Global economic woes negate demand optimism.
• Focus shifts to the US EIA weekly crude stocks data.

WTI (July futures on Nymex) trades steady around the 32 handle starting out a fresh contract, having displayed a stellar performance in the June month contract.

The black gold trades with 0.50% gains so far, lacking a clear directional bias amid mixed market sentiment, as the optimism over the signs of the oil demand recovery is overshadowed by the renewed global economic growth fears.

The recent macro news globally have re-ignited fears that the economic recession is here to stay, as there is no concrete sign of the coronavirus infections receding worldwide. While the lockdowns easing have brought second virus wave fears along with it.

Despite the cautious trading, the barrel of WTI remains somewhat underpinned by OPEC+ output cuts, with major OPEC producers offering to cut additional output in June to rebalance the oil markets.

Meanwhile, Reuters quoted some sources citing that the Russian oil and gas condensate output stood at 9.42 million barrel per day (bpd) in first 19 days of May vs. 11.35 million bpd seen in April on an average.

Further, the bullish US crude stocks data, published by the American Petroleum Institute (API), also keeps the upside bias intact in the commodity. The latest API data showed that the US crude inventories fell by 4.8 million barrels to 521.3 million barrels in the week to May 15.

Attention now turns towards the official US crude stocks change data from the Energy Information Administration (EIA), due later today at 1430 GMT, for the next direction in the prices.

WTI technical levels to watch

At the press time, WTI trades at 32.10, with the immediate resistance awaits at 32.43/50 (daily pivot point/ psychological level), above which the 33 handle will be tested. To the downside, the 5-DMA at 30.39 could offer some support, below which 29.32, the classic daily S3, will be at risk.