WTI reaches multi-day highs above $42.00 ahead of EIA

Prices of the WTI regain the $42.00 mark and beyond.
Optimism on a coronavirus vaccine supports the upside.
The EIA’s weekly report on crude oil supplies comes up next.

Pablo Piovano FXStreet

Crude oil prices extend the optimism seen at the beginning of the week and push the barrel of WTI to new highs past the $42.00 mark on Wednesday.

WTI looks to data, pandemic

Prices of the West Texas Intermediate add to the weekly recovery after US pharmaceutical Pfizer Inc. (NYSE: PFE) announced its candidate vaccine is 95% effective according to final analysis figures (vs. last Monday’s 90% efficacy).

Adding to the upbeat sentiment surrounding the commodity, traders have started to anticipate that the OPEC+ could extend its oil output cuts for an extra three to six months, adding that the market could move into a deficit scenario as soon as the next year.

It is worth recalling that crude oil prices have started the week on a positive fashion following vaccine news over the weekend and latest data showing that Chinese refinery output rose to record highs in October (14.09 mbpd), adding to the idea of a solid demand for gasoline.

Later in the NA session, the EIA will publish its weekly report on US crude oil stockpiles after the API reported late on Tuesday an unexpected build of nearly 4.2 million barrels during last week.

WTI significant levels

At the moment the barrel of WTI is up 1.17% at $41.85 and faces the next hurdle at $42.44 (weekly high Nov.18) seconded by $43.04 (monthly high Nov.10) and finally $43.75 (monthly high Aug.26). On the downside, a breach of $40.12 (weekly low Nov.16) would aim to $39.49 (55-day SMA) and then $37.09 (low Nov.6).

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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