WTI bulls ignore the return of Gulf oil producers around mid-$41.00s

WTI seesaws near the early-month highs while taking rounds to $41.45/50 ahead of Friday’s European session. In doing so, the energy benchmark pays a little heed to Reuters’ piece conveying restoration of oil rigs in the Gulf of Mexico. The reason could be traced from the dull performance of the US dollar and mixed headlines from Saudi Arabia and the OPEC+ group comprising the Organization of the Petroleum Exporting Countries (OPEC) and its allies like Russia.

“US offshore drillers and exporters began a clearup on Thursday after Hurricane Sally weakened to a depression and started rebooting idle Gulf of Mexico rigs after closing the down for five days” said Reuters during the early Friday. The same could add into the 180 figures of weekly Baker Hughes US Oil Rig Count, up for publishing around 17:00 GMT.

Saudi Arabia copied the OPEC+ terms while showing readiness to attack those who are taking part in the price manipulations. “Anyone who thinks they will get a word from me on what we will do next, is absolutely living in a La La Land... I’m going to make sure whoever gambles on this market will be touching like hell,” Prince Abdulaziz bin Salman of Saudi Arabia said, per Reuters. “OPEC+’s key panel, known as the joint ministerial monitoring committee, pressed for better compliance with oil output cuts against the backdrop of falling crude prices as uncertainty reigns over the global economic outlook,” the news said further. As per the Saudi oil export data published on Thursday, the Arab push of oil rose in July to 5.73 million barrels per day (bpd).

Elsewhere, the US dollar still nurses the post-Fed losses while eyeing today’s Michigan Consumer Sentiment data for September, expected 75.00 versus 74.1 prior.

It’s worth mentioning that the fears of the coronavirus (COVID-19) resurgence are getting momentum in the UK and pushes Prime Minister Boris Johnson for a national lockdown. On the other hand, the US-China tussle is getting back on the table, this time over Taiwan, which in turn offers an extra barrier to WTI’s further upside.

Technical analysis

Considering the strength of the 200-bar SMA and signals of a pullback marked by the RSI, sellers remain hopeful. The same push them to look for entry if oil prices drop below the 61.8% Fibonacci retracement level of August 26 to September 08 downside, near $41.00. Meanwhile, a sustained clearance of $41.42 figures, comprising 200-bar SMA, will aim for September 04 top of $42.07 before the August 27 bottom near $42.50 challenge further rise.