WTI climbs to 3-day highs beyond $53.00 ahead of API

Prices of the barrel of the American reference for the sweet light crude oil are sharply higher on Tuesday, managing to retake the key $53.00 mark, or gaining more than 2% on the day.

WTI bid ahead of API report

The WTI gained sudden upside traction and are navigating fresh 3-day highs after President Trump said he will meet China’s Xi Jingpin at the G-20 meeting in Japan next week, all following a ‘constructive’ telephone call.

In the meantime, geopolitical tensions including the US and Iran in the wake of the attacks to oil tankers in the Gulf of Oman last week remain well in place and are underpinning higher prices from the supply side. In this regard, Iran’s Rouhani said earlier today that his country ‘would not wage war against any nation’.

Later in the day, the American Petroleum Institute will report on US crude oil supplies during last week.

What to look for around WTI

Crude oil appears to have shifted its focus of attention to the macro context, where the protracted US-China trade dispute and its negative consequences on global growth and demand for oil keep weighing on traders’ sentiment. Geopolitical jitters, particularly after the recent attacks in the Gulf of Oman, have triggered just a short-lived relief-rally, while there still no evidence of any culprits. This view has relegated – albeit temporarily – positive drivers coming in from the supply side, including the tight US market, the OPEC+ agreement (and potential extension) to curb oil production and the so-called ‘Saudi put’.

WTI significant levels

At the moment the barrel of WTI is gaining 2.41% at $53.18 and a breakout of $54.76 (high Jun.10) would aim for $58.44 (100-day SMA) and finally $58.97 (200-day SMA). On the flip side, immediate contention emerges at $50.54 (monthly low Jun.5) seconded by $47.39 (78.6% Fibo of the December-April rally) and finally $44.23 (2019 low Jan.2).