WTI clings to modest gains above $53 ahead of API data

• Global growth concerns weighed on crude oil prices on Tuesday.
• OPEC’s Barkindo voiced his support for deeper cuts in oil production.
• Coming up: The American Petroleum Institue’s (API) weekly crude oil stock data.

Crude oil prices came under pressure on Tuesday after  the International Monetary Fund (IMF) announced that it lowered the 2019 global growth forecast to 3% from 3.2% in July to revive concerns over a dismal energy demand outlook. The barrel of West Texas Intermediate lost more than 1% and closed the day below the $53. handle.

Signs of weakness in global economy

The IMF also cut the 2020 global growth forecast to 3.4% from 3.5%. “Risks are skewed to the downside due to the uncertainty over trade tensions, Brexit, declines in risk appetite, manufacturing weakness,” the IMF noted.

On the other hand, the Organization of the Petroleum Exporting Countries (OPEC) Secretary-General Mohammad Barkindo, who last Friday noted that a  deeper production cut was among the options for OPEC and its allies to consider in December, reiterated that OPEC would do what it could with allied producers to sustain oil market stability beyond 2020, per Reuters, and helped crude oil prices limit its losses.  

As of writing, the barrel of West Texas Intermediate was trading a little above the $53 handle, adding 0.3% on a daily basis. Later in the session, the American Petroleum Institue’s (API) weekly crude oil stock data will be looked upon for fresh impetus.

Technical levels to watch for