WTI holding onto $90, looking to end the week on a high note
- US oil took a small hit on Friday, but is rebounding firmly to hold $90/bbl.
- OPEC production cuts are squeezing crude prices into the ceiling.
- The next hurdle for buyers will be pushing crude into $100.
West Texas Intermediary (WTI) US crude oil hesitated in Friday trading, dipping to $88.60 per barrel before rebounding to the $90/bbl major handle. US crude oil is on pace to close in the green for the fourth straight month, rallying nearly 40% from the year’s lows near $64.50.
Extended production cuts from member states of the Organization of the Petroleum Exporting Countries (OPEC) crude oil cartel are putting a tight squeeze on crude markets., sending US crude to ten-month highs.
OPEC-led oil cuts sending oil barrels higher
Saudi Arabia and Russia both recently, announced an extension of their current oil production cuts, extending a combined 1.3 million barrel per day (bpd) decline in headline barrel production through the end of the year.
When announcing the cut extensions, Riyadh stated that the production cuts were to promote stability in global oil markets. It is generally accepted by oil analysts that Saudi Arabia needs oil to be above $85 per barrel to balance their budget.
WTI technical outlook
US crude oil barrels have closed either flat or in the green for fifteen of the last sixteen trading days and are currently poised to end the week on the high side, mounting the $90/bbl level. Bulls will be firmly targeting the $100.00 major psychological level despite Friday’s brief decline, which could be a sign of profit-taking rather than an actual reversal, given the market’s rapid rebound.
Technical support for any moves to the downside will be at August’s last swing high near $84.00, and the nearest challenge for buyers will be the strong swing points that were marked in at $92.00 in late 2022.
WTI daily chart
WTI technical levels
Author
Joshua Gibson
FXStreet
Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.
