Oil hits two-month low, WTI getting held over $66.00

Crude oil prices are seeing continued pushes to the downside as oil investors grapple with still-rising US supplies of crude oil and massive sell-side shocks across broader markets that see investors pulling their cash out of riskier assets, including oil barrels.

US supplies of Amercian crude continue to rise as domestic demand doesn't stand a chance of catching up to the levels of production being achieved by US producers, and WTI prices which were bumping back into multi-year highs on fear surrounding the upcoming US sanctions on Iran, are now heading steadily lower as US production numbers roll over the current supply lines. On the flip side, getting US crude barrels across the oceans to eat up missing supply when the US introduces full-scale embargoes on Iran beginning on November 4th is an incredibly difficult proposition, and with most oil users in the Middle East and elsewhere using machinery that requires Middle East oil sources, future price shocks on US-Iran troubles could be on the cards in the future.

WTI levels to watch

US oil barrels are trading near 66.50 after dipping briefly into a two-month low on Tuesday, but firm selling is keeping crude pinned to the current low end near the 66.00 handle, and the next support zone is seen at August's swing low of 64.50, with resistance sitting at the critical 200-day moving average capping action near 67.60.