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  • Upside appears more compelling amid hopes of faster demand recovery.
  • Coronavirus vaccine-driven optimism underpins ahead of US FDA seal.
  • Rising US crude supplies remain a cause for concern.

Fresh bids emerged just above the midpoint of the 45 level, allowing a bounce in WTI (futures on NYMEX) to test the 46 mark, as the optimism over the coronavirus vaccine continues to keep the buyers hopeful.

The oil bulls continue to cheer the narrative that the coronavirus vaccine rollout would help quicken global economic rebound, which, in turn, would boost the prospects of oil demand recovery.

Globally, vaccinations have started in the UK while Canada approved the inoculation on Wednesday. The US Food and Drug Administration (FDA) is set to approve Pfizer’s covid vaccine later in the day.

Further, an explosion at an Iraqi oilfield also offered support to the WTI barrel. Two wells at a small field were set ablaze by explosives on Wednesday, Reuters reported, although the production remained unaffected.

Despite the bounce, markets remain wary amid rising US crude supplies, especially after the Energy Information Administration’s (EIA) latest weekly report showed a 15.2-million-barrel build in crude oil inventories.

Attention also turns towards the critical US CPI and Jobless Claims data for fresh cues on dollar-sensitive oil.

WTI technical levels

Wednesday’s doji candlestick above the 12-day-old support line suggests a gradual recovery of oil prices eyeing the monthly high of $46.75. Meanwhile, any downside past-$45.17, comprising the stated support line, will attack the monthly low near $44.00,” FXStreet’s Anil Panchal explains. 

WTI additional levels