WTI consolidation goes on as OPEC frown upon Trump protectionist measures

• OPEC says tariffs, rising interest rates may slow down trade and oil demand.
• Crude oil is still bouncing off the 60 level waiting for a catalyst. 

In its monthly report, the OPEC said that the protectionist measures taken by Trump, with the tariffs on steel and aluminum and now China, may slow down global economic growth, therefore, lowering oil demand. 

According to the cartel, "the most recent trade-related developments may provide challenges to the growth momentum as global trade has been an important factor contributing to the world economy."

In 2018 Crude supplies from the US and other non-OPEC countries should exceed the increase in global oil demand, according to analysts. 

OPEC says economic trend growth in developing countries such as China, India, and Brazil stay healthy. However, it warns that rising U.S. interest rates may cause investors to pull capital away from developing countries, where foreign investment has increased the economic activity as well as domestic oil demand.

However, OPEC keeps an upbeat tone on the oil market as a whole: "Nevertheless, the current healthy momentum in the global economy, together with the efforts undertaken by the OPEC and non-OPEC oil producing countries under the Declaration of Cooperation, is supporting the rebalancing of the oil market fundamentals,". 

Earlier in the US session, the EIA announced that crude oil supplies rose by 5.022mb against an expected build of 2.023mb. Weekly Distillates Stocks decreased by 4.360mb and Gasoline stockpiles dropped by 6.271mb.

WTI daily chart

The technical picture remains unchanged since yesterday. Crude is still bouncing at the 60 level and is trapped in a compression pattern. A break below 60 should lead to a test of 58 cyclical low while a break above the descending trendline may bring the price to revisit 64, last swing high and 66.60 the high for the year.