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  • Underpinned on hopes of OPEC disagreement on output hike.
  • Eyes on OPEC outcome and US drilling activity report for fresh direction.

WTI (oil futures on NYMEX) hit fresh five-day highs at $ 66.64 in mid-Asia and since then entered a phase of upside consolidation, as we heading into the OPEC meeting on the output policy.

The upbeat tone seen around the black gold can be mainly attributed to the ongoing disagreement between the OPEC and non-OPEC member on the output boost. Saudi Arabia and Russia proposed an output hike of 1 million barrel per day (bpd) last month.

However, not all OPEC members are likely to accept proposal of output increase of 1 million bpd, an OPEC delegate said. Iran, Oman, Venezuela and Nigeria have casts doubts over their support for an output hike.  

Any hike in the OPEC and non-OPEC output by less than 1 million bpd could fuel a fresh buying interest in the barrel of WTI, taking the rates back above the $ 67 level. In the meantime, the developments around the OPEC meeting and the US rigs count data will offer near-term trading impetus to the prices.

WTI Technical Levels:

Resistances: $ 66.64 (5-day highs), $ 67 (round number), $ 67.35 (classic R2/ Fib R3).

Supports: $ 65.83 (5-DMA), $ 65.47 (daily pivot/ 100-DMA), $ 64.72 (classic S1).