- Oil getting weighed on by rising supply, but this time not just the US.
- US Dollar has also lost some ground today, contributing to oil prices.
Crude oil is on the low side to cap off the week, with WTI trading close to 70.60 after dropping for three days straight this week.
The party could be ending soon, and oil is looking set to price in a technical correction, if not an outright reversal, as news broke today that major OPEC members, mainly Russia and Saudi Arabia, gave some rumblings that the two countries are considering easing off of their OPEC-led supply limits as trade tensions with the US have sent oil soaring. Oil supplies outside of the US have stabilized lately, and Russia is keen to get the crude flowing once again.
Elsewhere in the world, US supplies of crude oil continue to burgeon, and US weekly crude stocks jumped higher once again this week. Ater peaking at a multi-year high of 72.82 this week, oil is already swooning, and rising production figures could see oil traders take a bath.
WTI levels to watch
As posted on FXStreet by Slobodan Drvenica: “Concerns over strong rise in weekly oil inventories (US crude stocks rose 5.77 million barrels vs forecasted draw of 1.56 million barrels) and US production holding at all-time high, weigh on oil prices, helped by weaker dollar. Pullback from new multi-year recovery high at $72.89 penetrated thick 4-hr cloud (spanned between $71.37 and $69.95) could extend towards strong supports at $70.61 (Fibo 38.2% of $66.91/$72.89) and 70.37$ (rising 20SMA). Break below 10SMA ($71.50) was initial bearish signal, with further easing supported by south-heading 14-d momentum and slow stochastic).”
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