- WTI is currently trading at $59.06bbls between a range of $58.08bbls and $59.21bbls.
- Technicals are aligned bullishly.
WTI has climbed on Monday following the weekend news that OPEC members have agreed to trim 800,000 barrels a day from October’s production levels for six months through June of this year, with Russia and other allied producers cutting another 400,000 barrels a day to total 1.2 million barrels in cuts.
On Monday, another meeting took place between the Joint Ministerial Monitoring Committee, (JMMC), where “overall conformity” was seen rising to almost 90% in February, up from 83% in January – The Joint Ministerial Monitoring Committee is a production policy monitoring group that includes Saudi Arabia and Russia. Meanwhile, the output cut agreement has led to a more than 25% rise in price of Brent oil YTD.
The JMMC recommended that OPEC forgo a meeting scheduled for April and instead it should take place on June 25 to make a decision on the production target for the second half of the year.
Traders eyes are now on the Energy Information Administration data.
- EIA estimates that U.S. crude oil production averaged 11.9 million barrels per day (b/d) in February, down slightly from the January average. EIA forecasts that U.S. crude oil production will average 12.3 million b/d in 2019 and 13.0 million b/d in 2020, with most of the growth coming from the Permian region of Texas and New Mexico.
WTI levels
While the price holds above the double-top highs and above the 57.93 horizontal prior resistance line going back to mid-Nov 2018, the market leans bullish. However, a break of 59.70 is needed where bulls will then look to the 61.8% Fibo of the Oct 2018 sell-off to late Dec lows at 63.74, reviving prospects for the 70 handle. On the flipside, a fall to 54.50 will open a case for 50.50 as the 23.6% Fibo support structure.
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