WTI drops to fresh 2017 lows around $43.50

Pablo Piovano FXStreet

Crude oil prices stay entrenched into the negative territory today, dragging the barrel of West Texas Intermediate to fresh YTD lows in the mid-$43.00.

WTI weaker on supply glut concerns

Prices for the WTI dropped to levels last seen in November around $43.50 in response to heightened concerns over the supply glut in the oil market.

In addition, prospects of rising US oil production continue to add to the global concerns, as driller Baker Hughes reported on Friday its 22^nd consecutive increase in US oil rig count, taking US active oil rigs to 747 during the week ended on June 16.

The rising US drilling activity continues to weigh on the recently extended OPEC/non-OPEC deal to limit the oil production until Q1 2018, deteriorating further the sentiment among traders.

Looking ahead, the American Petroleum Institute will publish its report on US supplies later today, ahead of tomorrow’s DoE’s report on inventories.

WTI levels to consider

At the moment the barrel of WTI is down 2.05% at $43.52 facing the immediate support at $42.20 (monthly low Nov.14 2016) seconded by $41.10 (low Aug.11 2016) and finally $39.19 (monthly low Aug.3 2016). On the flip side, a break above $45.06 (high Jun.19) would open the door to $46.71 (high Jun.12) and then $47.07 (20-day sma).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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