- Brent oil is down 0.30 percent in Asia.
- US output in 2017 increased more than Saudi Arabia.
- Oil is stuck in a symmetrical triangle pattern.
Brent oil is trading on the back foot, just below the ascending 100-day moving average (MA) of $64.70 in Asia as the as the relentless rise in US crude output keeps bulls at bay.
"US crude oil production soared past 10 million barrels per day (bpd) in late 2017, overtaking output by top exporter Saudi Arabia", according to Reuters report. Further, the International Energy Agency (IEA) now sees the US output rising above 11 million bpd by late 2018, taking the top spot from Russia.
While OPEC and its allies have almost achieved their aim of clearing an oil glut, but their efforts could be derailed by a sharp rise in the US supplies. Thus, oil prices are feeling the gravitational pull since yesterday.
The selling could gather pace if the EIA data due tomorrow shows a rise in the Us oil inventories.
Brent Technical Levels
Oil has created a symmetrical triangle on the daily chart. A break above $64.83 (Asian session high) would add credence to an upward sloping (bullish biased) 100-day MA and would open doors for $65.70 (previous day's high) and $66.00 (symmetrical triangle resistance). A close higher would signal a continuation of the rally from the February low of $61.61.
On the downside, a close below $63.90 (symmetrical triangle support) would revive the sell-off from the high of $70.79 and would allow a deeper drop to $61.61 (February low) and $61.00 (Nov. 17 low).
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