- OPEC+ warning, FOMC minutes negate US-China optimism.
- US dollar holds the higher ground, weighs on WTI.
- US employment and manufacturing data eyed for fresh cues.
WTI (futures on Nymex) has resumed its downside momentum following a brief consolidative stint seen in Asia around $42.70 region.
At the press time, the US oil drops 1.15% to flirts with daily lows just above $42.50. Despite the weakness, the black gold remains on track to book the third straight weekly gain.
Broad risk-aversion amid fresh concerns over the US economic recovery, sparked by the cautious FOMC minutes, continues to boost the have demand for the greenback at the expense of the higher-yielding oil. Also, markets are weighing the US threats to restore nearly all UN sanctions on Iran.
Further, the price remains undermined by rising concerns over the recovery for oil demand, especially after the statement released by the OPEC+ Joint Ministerial Monitoring Committee (JMMC), citing that the pace of oil market recovery appeared to be slower than expected amid with growing risks of a prolonged second wave of COVID-19.
Although, the black gold could find some support from the falling US crude stockpiles, which declined for the fourth straight week while optimism over the US-China trade talks could also limit the downside in the commodity. China is the world’s second-largest oil consumer.
Markets now await the US Jobless Claims and Philly Fed Manufacturing data for fresh insights on the US economic health, which could likely impact the barrel of WTI.
WTI technical levels to watch
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