Crude Oil News: prices remain depressed near $56.00

  • WTI stays on the defensive near the $56.00 ark.
  • Trade headlines, US supplies keep weighing on sentiment.
  • Baker Hughes’ oil rig count next on the docket.

After failing to regain the key $58.00 mark earlier in the session, prices of the barrel of the West Texas Intermediate have sparked a corrective downside to the vicinity of the $56.00 handle.

WTI loses ground on data, trade

WTI has resumed the downside today as the US-China trade negotiations appear somewhat stalled around the timing and venue regarding the sign of the ‘Phase One’ deal as well as increasing speculations on the size of the potential roll over of part of the existing tariffs.

Also weighing down on prices, the EIA reported another large build in US crude oil inventories during last week.

In the meantime, WTI is struggling to close the week with gains despite Thursday’s move to the $58.00 area, or fresh 6-week highs.

Later in the session, driller Baker Hughes is expected to publish its weekly report on US oil rig count, which has shown a persistent decline in past weeks.

What to look for around WTI

WTI prices have failed once again to surpass the critical 200-day SMA in the $57.30 region on a sustainable note, leaving the weekly tops at levels just shy of the $58.00 mark per barrel. The US-China trade developments remain the almost exclusive driver of crude oil prices in the near term at least, while speculations continue to gyrate around the probability of removing part of the existing tariffs and the timing of the “Phase One’ deal signing. On the negative side, another significant build in US crude oil supplies have dented the mood among traders in line with downbeat headlines from the upcoming OPEC+ meeting.

WTI significant levels

At the moment the barrel of WTI is losing 1.68% at $56.18 and a breakdown of $56.02 (100-day SMA) would expose $55.45 (55-day SMA) and finally $53.71 (low Oct.31). On the upside, the next resistance lines up at $57.82 (monthly high Nov.8) followed by $60.00 (psychological handle) and then $60.94 (monthly high Jul.11).

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