- WTI trades near $57.15 ahead of Asian open on Thursday.
- The decline in EIA stockpile and Saudi comments favored the price recovery.
- Developments surrounding the US-China trade accord could become helpful to determine immediate moves.
WTI is on bids around $57.15 as traders await early Asian sessions on Thursday. The energy benchmark holds recent gains after the weekly report from US EIA registered drawdown. Additionally, OPEC members’ refusal to respect the US President Donald Trump’s comments demanding supply increase also helped Crude prices. Looking forward, investors may now put high importance on developments surrounding the US-China trade talks as recent reports were downbeat ahead of the likely Trump-Xi meet.
The weekly release of the US Energy Information Administration’s (EIA) crude stockpile report registered its first drawdown in six weeks. The stockpile declined 8.6 million barrels last week versus market consensus favoring 2.8 million barrels of addition.
Earlier during the week, the US President Trump tweeted to global energy suppliers, like OPEC+ alliance, to relax the output cuts. However, the Saudi Arabian energy minister Khalid al-Falih refused to respect Trump’s push on Wednesday. Reuters also reported that OPEC Secretary General Mohammed Barkindo commented that managing world supply is difficult when two members – Iran and Venezuela – are under sanction from the United States. The statement was likely supporting Saudi energy minister’s signal for extended supply cuts.
While supply-side concerns were much highlighted for the WTI’s increase, the news wasn’t good on the demand side.
The US-China trade talks are about to close after 90 days of discussion on March 01. The US President has already shown readiness to wait for a bit more before levying additional tariffs on China’s products and is looking forward to meeting his Chinese counterpart Xi Jinping in Florida to finalize the deal. Though, recent comments from the US trade representative Robert Lighthizer were downbeat. Lighthizer said that the deal must not be just China purchases, but should include enforcement. The statement seems pushing for the structural changes into the world’s second-largest economy, which in turn is less likely to be respected from the dragon nation and can cause a problem for the smooth running of a deal.
WTI Technical Analysis
100-day simple moving average (SMA) at $56.15 and an upward sloping trend-line connecting December-February lows around $54.80 are likely nearby supports for the energy benchmark.
On the upside, $58.00 and $59.30 may act as immediate barriers ahead of highlighting $60.00 resistance mark.
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