Search ForexCrunch
  • WTI breaks consolidation to the upside amid risk-on European trading.
  • Russian producers may support OPEC+ extension of output cuts.
  • Focus on API crude stocks data, US election outcome.

WTI (futures on NYMEX) has resumed the overnight rebound in the European session following the Asian consolidative mode, as the bulls return along with appetite for risk assets.

The risk-on flows pick up pace in Europe amid increased odds of a sweeping ‘Blue Wave’ win in the US election, which will pave the way for a larger fiscal stimulus package. The upbeat market mood powered the higher-yielding oil at the expense of the safe-haven US dollar.

At the time of writing, WTI jumps 3% to flirt with five-day highs of $37.99, as the sentiment around the black gold also remains underpinned by the prospects of OPEC+ output cuts extension.

This comes after “Russian oil companies told Energy Intelligence that they may be willing to extend the OPEC+ oil output cut accord if current unsupportive market conditions persist,” FXStreet’s Analyst Omkar Godbole noted. OPEC and its allies (OPEC+) hold its next full meeting at the end of this month.

However, it remains to be seen if the price can sustain the recovery momentum from half-yearly lows of $33.65, as markets expect the weekly US crude stockpiles to rise by about two million barrels in the week to Oct. 30.

Also, the sentiment on Wall Street could weaken as the Americans head for polls later in the day, which could probably cap the upside in the WTI barrel. A contested election would be a nightmare for the markets.

WTI technical levels