- WTI kicks-off the week sharply lower on OPEC+ meeting woes.
- Oil reverses 30% gains seen last week on hopes of OPEC+ output cuts.
- All eyes on the US and OPEC headlines amid coronavirus updates.
WTI (oil futures on NYMEX) opens the week with a bearish gap of $3 or 10%, as the bears fight back control on uncertainty over the likely meeting between the OPEC and non-OPEC producers (OPEC+).
Earlier the meeting to discuss the oil output cuts was scheduled for April 6. However, the Reuters sources reported over the weekend that it is now postponed to April 9, allowing more non -OPEC producers, including the US, Norway and Canada, to come on board and join in the production cuts to stem the price declines, the wake of the coronavirus pandemic induces demand concerns.
The black gold is reversing the 30% weekly rise, diving from Friday’s close of 28.97 top open the week at 25.98. At the press time, the US oil sheds nearly 11% to trade at 25.90, having hit a low of 25.41.
Despite the early knockdown, markets expect a turnaround in the barrel of WTI, largely on the back of increased expectations that the OPEC+ oil output cuts will materialize this week, especially with Russia confirming its participation in the meeting.
The alliance is likely to debate oil output cuts of 10 million barrels per day (bpd) when they gather at the emergency meeting. Additionally, US President Trump’s announcement that they will impose tariffs on Saudi and Russian production, potentially accelerating an output cutback, could offer some respite to the bulls.
The black gold rallied hard last week after US President Donald Trump said that Saudi and Russia could soon reach a deal to cut the production by 10 to 15 million bpd while markets see a potential price war truce.
Attention now turns towards the OPEC+-related headlines and Trump’s take on the likely tariffs for a fresh direction in the prices. Meanwhile, investors will take cues from a better market mood amid broad dollar strength, as virus fears continue to weigh.
WTI technical levels to consider
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