- WTI trades around $56.50 on early Friday.
- While production and inventory details from the US dragged energy prices downward, positive news from the US-China trade front limits the declines.
- $56.25 acts as immediate support while $57.00 can cap nearby upside.
WTI refrains from extending its previous declines beneath $56.50 on early Friday. The energy benchmark dropped Thursday after the US reported record production. The early-day positive report from the US-China trade front is likely limiting the energy downside.
The Energy Information Administration (EIA) reported that the US crude oil production reached 12 million barrels per day (bpd) for the first time last week. The government source also released weekly inventory levels wherein it followed the earlier industry report by rising 3.7 million barrels to 454.5 million barrels. Following the news, the energy prices declined for the first time in more than a week’s time.
At the start of Friday, energy traders concentrated more on positive news from the US-China trade front than the supply-glut. During the first day of Chinese Vice Premier’s Washington visit, the dragon nation agreed to import more of the US agricultural products. Representatives of both the economies are also preparing for Memorandum of Understanding (MoU) that could help come to a deal soon. Also, the US President Donald Trump is likely to meet the Vice Premier Liu He during Friday afternoon to give more emphasis on the trade deal.
Looking forward, energy traders are likely to concentrate more on the trade developments considering the affair between the world’s two largest economies. On the background, supply cuts by the OPEC+ and the US sanctions on Iran and Venezuela may also add strength to the upside momentum, if any.
WTI Technical Analysis
The 100-day simple moving average (SMA) figure of $56.20 seems immediate support for WTI traders, a break of which can recall $55.65 and $55.10 on the chart.
Meanwhile, $57.00 and $57.60 seem nearby resistances ahead of highlighting $58.00 for buyers.