WTI flirts with weekly highs just below $27.00 ahead of API
- Prices of the WTI reverse Monday’s pullback and advance beyond $26.00.
- Saudi Arabia extra cuts, re-opening of the economy bolster prices.
- The API will publish its report on US crude oil supplies later on Tuesday.
Prices of the barrel of the American reference for the sweet light crude oil are reversing Monday’s negative price action and moved to the vicinity of the $27.00 mark on Tuesday.
WTI focused on data, production cuts
The renewed upside pressure in prices of the WTI is bolstered by recent announcements that Saudi Arabia, Kuwait and the UAE will implement additional output cuts, removing an extra 1.18 million bpd starting next month.
Additionally, the ongoing and gradual re-opening of economies in Europe and the US is expected to alleviate the demand side of the crude oil crisis that was aggravated by the coronavirus outbreak. This, in turn, is fuelling the idea that the worst of the oil crisis could be behind.
Further out, driller Baker Hughes reported on Friday another drop in US oil rig count, while the speculative community trimmed its net longs in the commodity to new 3-week low during the week ended on May 5th.
Moving forward, the API will report on weekly US crude oil supplies ahead of Wednesday’s report by the EIA.
WTI significant levels
At the moment the barrel of WTI is gaining 3.14% at $26.20 and faces the next resistance at $27.95 (monthly high May.6) seconded by $29.11 (monthly high Apr.3) and then $36.28 (high Mar.11). On the downside, a breach of $24.81 (weekly low May 11) would aim for $10.27 (low Apr.28) and finally $6.60 (low Apr.21).