WTI steadies below $60 as investors wait for Saudi oil minister’s presser

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  • Saudi Arabia’s oil output is expected to return to normal levels faster than forecasted.
  • Saudi oil minister is scheduled to address the situation in the industry at 17:15 GMT. 
  • American Petroleum Institue will release the weekly stock report later in the day.

Following Monday’s rally, crude oil prices staged a deep correction today on latest headlines surrounding the situation in Saudi Arabia’s oil facilities. The barrel of West Texas Intermediate, which added more than 12% yesterday, fell below the $60 handle and was last seen trading at $59.77, losing 3.3% on a daily basis.

Citing industry sources familiar with direct knowledge of the matter, Reuters today reported that crude oil output of the kingdom was expected to return to normal levels in the next two to three weeks to ease concerns over protracted supply disruptions.

“Saudi Arabia is close to restoring 70% of the 5.7 million barrels per day of oil output loss,” sources told Reuters. “The impact on Saudi Arabian oil exports has been minimal during the crisis thanks to storage.”

Eyes on the Middle East

On the other hand, the tensions remain high in the Middle East and a further escalation could trigger another buying wave. Earlier today, CBS News reported that the US has identified southern Iran as the location where missiles were launched. Moreover, US Vice President Pence said that the US military was ready to defend its interest and allies in the Middle East.

Markets are now waiting for Saudi Arabia’s oil minister to update the press at 17:15 GMT. Later in the day, the American Petroleum Institute will be releasing its weekly crude oil stock report as well but the data is unlikely to cause a significant market reaction as investors seem to be staying focused on the conflict in the Middle East.

Technical levels to watch for

 

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