WTI clinches fresh 3-day highs above $62.00, looks to OPEC+
|- Prices of the WTI push higher to the area above $62.00.
- Traders’ attention remains on the OPEC+ meeting (under way).
- Consensus among investors stays divided on the OPEC+ decision.
Prices of the American reference for the sweet light crude oil advance past the $62.00 mark per barrel on Thursday.
WTI in multi-day highs, looks to OPEC+
The barrel of WTI adds to Wednesday’s decent gains against the backdrop of increasing optimism regarding the ongoing OPEC+ meeting.
In fact, traders appear divided over the probable decision by the cartel, as it could roll over the current oil output cuts into the next month or increase a tad the production (most likely by 500K bpd).
The cartel, in its decision-making process, is expected to gauge whether the recent rally in crude oil prices warrants an increase in the production vs. the uncertainty facing the industry in the post-pandemic scenario.
Earlier on Wednesday, the EIA reported US crude oil supplies went up sharply by 21.563M barrels during last week (largely due to the past freezing weather in Texas). On Tuesday, the API also reported a larger-than-expected build in crude stockpiles, this time by 7.356M barrels.
What to look for around WTI
Prices of the West Texas Intermediate resume the upside and retake the $62.00 mark and beyond ahead of the OPEC+ meeting. Increasing inflows into commodity-based ETFs have been supporting the rally in crude oil along with the drop in US crude oil supplies, freezing weather conditions in Texas and the generalized favourable context for riskier assets. The latter was underpinned at the same time by the acceleration of the vaccine rollout in Europe/ Asia, adding to the idea of a strong rebound post-coronavirus pandemic.
Key events in the crude oil space: OPEC+ meeting on March 4th.
Eminent issues on the back boiler: Higher crude oil prices favour US shale growth. Demand-supply balance could prompt a moderate correction lower later in the year.
WTI significant levels
At the moment the barrel of WTI is up 1.92% at $62.25 and faces the next hurdle at 63.79 (2021 high Feb.25) seconded by $65.62 (2020 high Jan.8) and finally $66.58 (2019 high Apr.23). On the other hand, a breach of $59.27 (weekly low Mar.3) would expose $58.60 (low Feb.19) and then $57.43 (low Feb.12).
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