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  • Dragged down by swelling US inventories, record high US production.
  • Subdued greenback, OPEC headlines do little to support oil.
  • Focus shifts to US factory orders for fresh directives.

WTI (futures on Comex) broke its Asian consolidation phase to the downside and hit fresh three-day lows at 62.72 in the European session. At the press time, the black gold is seen making some tepid recovery attempts to regain the 63 handle.

The barrel of WTI came under renewed selling pressure, as the European traders reacted negatively to the latest US EIA reports that showed the US production levels hit record high, which in turn led to the bid build up in the US crude stockpiles.  

As Reuters reports, “U.S. crude stockpiles last week rose to their highest since September 2017, jumping by 9.9 million barrels to 470.6 barrels, as production set a record high of 12.3 million barrels per day (bpd), while refining rates fell.”

However, the buyers lurk at the lower levels, as they continue to find some support from the US sanctions on Iran’s oil exports, as the sanctions waiver expire while the ongoing political upheaval in Venezuela also add to the supply risks and intensify the expectations of tighter global markets.

Further markets also digest the latest reports, citing that Russia cut its April output by 223k barrel per day (bpd). Separately, the OPEC Chief Barkindo was reported, as saying that its impossible to eliminate Iranian oil from the market.

The immediate focus now remains on the US factory orders data due at 1400 GMT for fresh dollar trades that may eventually impact the USD-sensitive oil.

WTI Technical Levels