- Crude oil prices turn negative during the American session.
- WTI having the worst slide in five weeks, retreats from two-month highs.
WTI (July futures on Nymex) broke to the downside and lost 4% in a few minutes, falling to $32.10, the lowest level since last Friday. The price is losing almost $2. The move lower took place as equity prices in Wall Street reversed sharply, erasing most its gains and also as the DXY rebounded from weekly lows to positive territory.
Market sentiment was keeping WTI prices near monthly highs. On Wednesday, the European Comision recovery plan helped risk appetite, but tensions between the US and China and the lack of improvement in Brexit talks offset the positive tone.
Regarding oil, recent comments from Exxon Mobil CEO Darren Woods could have weighed on the price. He mentioned Exxon expects a 10% decline in demand in 2020 due to lost economic activity. Market participants await API inventory data to be released at 20:30 GMT.
Technical levels
The correction in WTI started after it was unable to rise above the $34.50 key resistance area and following the break of the $33.20 support (May 21 & 26 low). The slide was capped by $32.10; a decline below would clear the way to more losses with the next strong support seen at $31.20.
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