WTI erases $3 this week, looks to settle at 9-months lows near $60

  • WTI lost more than 20% in the past five weeks.
  • The number of active oil rigs in the U.S. increased to 886 this week.
  • Supply concerns weighed on crude oil prices throughout the week.

With today's fall, crude oil prices recorded their longest losing streak, 10-days, since 1984 as rising global supply and the concerning global economic outlook continued to weigh. The barrel of West Texas Intermediate, which touched its lowest level since February at $59.25 earlier today, was last seen trading at $60, losing 1.25% on a daily basis. Since setting its 4-year high at $76.90 on October 3rd, the WTI erased more than 20%.

The weekly EIA report on Wednesday revealed that the crude oil production in the U.S. hit a record high of 11.6 million barrels per day. Similarly, Russia and Saudi Arabia's output increased to 11.4 million barrels, and 10.7 million barrels per day, respectively. Commenting on the recent sell-off, "What a difference a month makes. Market sentiment has shifted from the most bullish tone in years with many calling for $100 only weeks ago, to the weakest investor sentiment since the 2016 price trough," Michael Tran, commodity strategist at RBC Capital Markets, told Reuters.

Meanwhile, Baker Hughes Energy Services reported that the total number of active oil rigs in the U.S. rose to 886 from 874 recorded a week ago to reflect the ramped-up crude production.

Moreover, the U.S. sanctions on Iran didn't have as severe of a negative impact on the global supply as initially thought to put extra weight on the black gold's shoulders. Earlier today, Reuters reported that a South Korean delegation was expected to travel to Iran to discuss resuming oil imports following the three-month halt. 

Technical outlook: Crude Oil WTI Technical Analysis: Black Gold turning into Red Gold as WTI falls below $60.00 a barrel and collapses 22% in a month.

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