Crude oil prices sink to fresh 2018 lows
- US companies added 26 oil rigs, to a total of 791 active drilling rigs.
- WTI below its 100 DMA for the first time since August 2017.
The sell-off in equities continues, supporting dollar's gains and dragging commodities' prices lower. Oil prices are a fresh 2018 lows, with West Texas Intermediate crude oil futures around $58.50 a barrel and Brent trading at $62.20 a barrel, undermined, additionally, by a sharp increase in US drillers activity.
The Baker Hughes report showed that US companies added 26 oil rigs this week, to a total of 791 active drilling rigs, the largest weekly increase in a year. The report is seen as an early indicator of future output, suggesting US production will continue rising.
Earlier this week, the EIA forecasted record US production of 10.59 million barrels per day for this year, while a separate report indicated that the US topped 10 million barrels a day this February, the highest level on record.
WTI technical outlook
WTI trades at levels last seen late December, breaking through its 100 DMA for the first time since August 2017, and while the day is not yet over, it seems it will close below the level. Technical readings in the daily chart favor additional declines, as indicators keep heading south, now nearing oversold readings, while in the 4 hours chart, technical indicators also head sharply lower, currently in extreme oversold levels. 57.43 is the immediate support, ahead of 56.86, this last, December 18th low.
Author
Valeria Bednarik
FXStreet
Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.
