WTI stays in red below $52, looks to add more than $3 for the week

• WTI remains on track to snap 8-day winning streak.
• Number of active oil rigs in the U.S. continue to decline.
• For the week, WTI gains more than $3.

Crude oil’s recovery that started on the last day of 2018 seems to have lost some steam lately. After closing the previous day with small gains, the barrel of West Texas Intermediate failed to hold above the $52 handle on Friday and was last seen trading at $51.80, losing 1.4% on a daily basis.

Nevertheless, today’s modest fall seems to be a technical correction of the recent rally and crude oil is likely to preserve its bullish momentum in the near-term. Earlier today, Fitch ratings in a recently published report forecasted that crude oil prices would continue to rise in 2019 as winding down of sanction waivers for Iran and continued strong demand from emerging markets would support the price appreciation.

Furthermore, the weekly data published by Baker Hughes today showed that the number of active oil rigs in the United States declined to 873 from 877 last week to suggest that the production output is likely to continue to retreat from record high levels that were recorded in the last quarter of 2018.

Key technical levels