WTI catches fresh bids, re-takes $ 69 on expectations of tighter markets
- Expectations of tighter markets negate OPEC’s output hike decision.
- A test of Friday’s high at $ 69.338 likely on supply disruption concerns.
WTI (oil futures on NYMEX) stalled its consolidative mode around mid-68s and regained momentum in a bid to test the $ 69 mark, as expectations of oil markets remaining tighter this year supported the sentiment around the prices.
A slight drop in the US drilling activity combined with a Canadian supply outage. The US rigs count declined by cut one oil rig, the first reduction in 12 weeks, lowering the total rig count to 862, the oilfields services company Baker Hughes said on Friday.
Meanwhile, Goldman Sachs also warned that an “outage at Syncrude Canada’s oil sands facility could leave North America short of 360,000 bpd of supply for all of July”.
The barrel of WTI jumped to the highest levels in four-weeks at $ 69.38 after the OPEC announced the output by 1 million barrels per day (bpd), which was already priced-in by the markets.
The focus now shifts towards the US weekly crude supplies report for fresh direction on the prices, as the dust settles after the OPEC aftermath.
WTI Technical Levels:
Resistances: $ 69.38 (4-week highs), $ 70 (round number), $ 70.80 (May 25 high).
Supports: $ 68.25/16 (50-DMA/ daily low), $ 67.60 (5-DMA), $ 66.75 (10-DMA).