WTI bulls look for direction around three-month high

Following its consecutive six-day winning streak, WTI seesaws around $61.10 during the Asian session on Friday. Even so, the energy benchmark trades near the highest in three-months flashed during the previous day.

The Organization of the Petroleum Exporting Countries (OPEC) and Russia’s, mostly known as OPEC+, agreement to add 500,000 barrels per day (bpd) to the previous reductions of 1.2 million bpd through March 2020 have initially triggered the oil’s rally during early December.  That followed the US-China phase-one and subsequent declines in the oil inventory reports, which currently pushes the black gold towards the best December since 2002.

In addition to the phase-one, successful passage of the United States Mexico Canada Agreement (USMCA) and the European Union’s readiness to do more business with China seem to portray a rosy trade environment.

At the political front, the US-Iran tussle continues with the latest punch coming in from the US Secretary of State Mike Pompeo who announced restriction of Iranian visas for officials who abuse detailed peaceful protestors. Further, a downbeat performance by the US Dollar (USD) could also be considered as adding strength to the oil prices.

Markets will now look forward to the final readings of the third quarter (Q3) Gross Domestic Product (GDP) data from the US and the UK for fresh direction. Also, the weekly release of Baker Hughes US Oil Rig Counts, prior to 667, can offer additional information.

Technical Analysis

A weekly closing beyond 100-week Simple Moving Average (SMA) level of $60.80 confirms the energy benchmark’s rush to September month high surrounding $63.15. Alternatively, November month high near $58.80 can please sellers during the fresh declines.