WTI testing daily highs above $61.00 ahead of API

• The barrel of WTI edges higher after two pullbacks in a row.
• The outlook for crude oil looks improved said the OPEC.
• Next on tap will be the API’s weekly report on supplies.

Prices of the West Texas Intermediate manage to regain some composure and retake the $61.00 mark and above on Tuesday.

WTI looks to OPEC, API

Crude oil prices reverse two consecutive daily pullbacks and manage to come back after bottoming out in the $59.50 region during early trade.

Positive comments from the OPEC collaborate with the bounce in crude oil prices after the cartel said it has an upbeat view on the outlook for the commodity.

Prices of the American benchmark for the sweet light crude oil recorded new 2021 highs in the vicinity of the $64.00 mark per barrel last week in response to solid prospects of a strong global recovery (mainly in China) coupled with the increasing likelihood of extra stimulus under the Biden’s administration and investors’ perception that a commodities’ super-cycle could be in the offing.

Moving forward, the OPEC+ meets on Thursday with the centre of the debate around the possibility that members could pump in extra oil in the markets (in light of the recent rally in prices).

Later in the session, the API will publish its weekly report on US crude oil inventories ahead of the EIA’s report on Wednesday.

What to look for around WTI

Prices of the West Texas Intermediate met decent resistance well past the $63.00 mark last week. Increasing inflows into commodity-based ETFs have been supporting the rally in crude oil along with the drop in US crude oil supplies, freezing weather conditions in Texas and the generalized favourable context for riskier assets. The latter was underpinned at the same time by the acceleration of the vaccine rollout in Europe/ Asia, adding to the idea of a strong rebound post-coronavirus pandemic.

Key events in the crude oil space: OPEC+ meeting on March 4^th.

Eminent issues on the back boiler: Higher crude oil prices favour US shale growth. Demand-supply balance could prompt a moderate correction lower later in the year.

WTI significant levels

At the moment the barrel of WTI is up 1.14% at $60.87 and faces the next hurdle at 63.79 (2021 high Feb.25) seconded by $65.62 (2020 high Jan.8) and finally $66.58 (2019 high Apr.23). On the other hand, a breach of $58.60 (low Feb.19) would expose $57.43 (low Feb.12) and then $54.56 (50-day SMA).