WTI faces rejection above $60 mark despite the Suez Canal blockage
- WTI fails to sustain the recovery, drops back below $60
- Suez Canal blockage and risk-on mood fail to entice oil buyers.
- A firmer US dollar caps the upside attempts in the US oil.
Having failed to resist above the $60 level, WTI (futures on NYMEX) fell sharpy to $59.36 before recapturing the $59.50 threshold.
At the press time, the US oil trades at $59.75, higher by 2% on the day. The black gold eyes the third straight weekly loss.
The WTI barrel caught a fresh bid-wave in the late-American trading on Thursday and staged a solid comeback, courtesy of the fears that the Suez Canal blockage could last for weeks.
A large container ship got stuck between both banks in the Suez Canal, which has led to the suspension of the traffic through the narrow channel linking Europe and Asia. A small percentage of the world’s crude is shipped through the canal.
However, the recovery fizzles out as the US dollar holds firmer near four-month highs across its main peers, in light of increasing expectations of faster US economic recovery. A stronger greenback makes the USD-denominated oil expensive for foreign buyers.
Looking ahead, a slew of US economic data and Baker Hughes oil rigs count data will be eyed for near-term trading opportunities. The updates about the Suez Canal situation could also have some impact on the black gold.
WTI: Technical levels
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
