WTI consolidates the upside near $26 amid imminent OPEC+ output cuts

WTI (oil futures on NYMEX) is consolidating the advance to a new two-day high of 26.66, as the bulls take a breather the recent bounce back from near 25.60 region. At the press time, the US oil trades at 26.05, still up 3.80% so far.

WTI: Bulls in complete control

A better market mood and expectations that the OPEC and non-OPEC producers (OPEC+) will reach an agreement on production cuts to stabilize the oil market have boded well for the black gold on Thursday, as the OPEC+ meeting gets underway. It's widely expected that the OPEC+ would agree on an output cut between 10 to 15 million barrels per day (bpd).

Amid signs that the coronavirus spread is likely slowing globally, the European stocks are on the rise while helping the higher-yielding oil remain buoyed. Meanwhile, the latest uptick in the black gold can be mainly attributed to the latest Reuters report, citing sources, that Russia may cut up to two mln bpd under any global oil pact.

This came as a positive surprise for the oil traders, as it was earlier reported that Russia was prepared to cut oil output by about 14% of its Q1 average or 1.6 million bpd. Further, broad-based US dollar weakness also seems to lend support to the USD-sensitive oil.

Ahead of the OPEC+ decision, markets weigh in the headlines from the Russian OPEC sources that Saudi and Russia still remain at odds over plans for output cuts. Traders also digest the rise in US Crude Stocks, as reported by the US Energy Information Administration (EIA) on Wednesday. The US crude stockpile rose by 15.2 million barrels, their biggest ever one-week rise, the EIA data showed.

Besides, the OPEC+ meeting, the focus also remains on the G20 energy ministers extraordinary meeting due on Friday “to ensure energy market stability”.