- OPEC+ meeting confirmation for Saturday puts a fresh bid under WTI.
- Hopes of oil output cut extensions and economic optimism underpin.
- Focus on US data and risk trends for fresh directives.
WTI (July futures on Nymex) hit a new three-month high at 38.27 in the last hour, now consolidating the latest uptick just above 38.00, up nearly 2% on the day.
The black gold caught a fresh bid-wave after Russia’s Energy Minister Alexander Novak confirmed about the OPEC and its allies (OPEC+) meeting being scheduled on June 6, Saturday.
After a lot of uncertainty and rumors doing the rounds around the OPEC+ meeting, the confirmation on the same gives markets some hopes that an agreement on the oil output cuts extension will be reached and that the OPEC+ will push Iraq and Nigeria to comply better with the cuts.
Meanwhile, the upbeat market mood on signs of global economic recovery and the risk-on narrative collaborates with the positive tone seen in oil prices. Broad-based US dollar weakness amid a return in the risk appetite also aids the upside in the USD-sensitive oil.
Looking ahead, the sentiment on the global markets could remain the main driver, in the light of the US jobs data release. Meanwhile, the optimism on the likely OPEC+ output cuts extension will keep the bulls underpinned.
WTI technical levels to watch
“…the triangle’s upper line, the recent high surrounding $38.30 could also challenge the bulls during the further rise, which if ignored could escalate the advances to fill the early-March gap below $41.22. Meanwhile, the said triangle’s support, near $37.00, followed by an upward sloping trend line from May 28, at $36.85 now, restricts the quote’s immediate declines. In a case where the oil benchmark drops below $36.85, a 200-HMA level of $35.10 and May 28 top near $34.35 could entertain the sellers,” FXStreet’s Analyst Anil Panchal noted.