WTI rebound crosses $77.00 as China-linked fears ease, EU struggles over Russian oil price cap

WTI extends the previous day’s corrective bounce off yearly low.
Downbeat daily infections, support measures for real-estate firms favor markets in China and abroad.
Rumors over OPEC+ production cuts, European Union’s struggle over Russian oil price cap keeps oil buyers hopeful.
Risk catalysts, weekly industry inventory data can direct short-term moves.

Anil Panchal FXStreet

WTI crude oil picks up bids to refresh intraday high near $77.25 while extending the late Monday’s recovery from the yearly low during Tuesday’s Asian session.

The commodity’s latest rebound could be linked to the market’s cautious optimism as well as speculations that the OPEC+ will aim for production cuts during the next meeting. Also keeping the energy buyers hopeful is the European Union’s struggle to announce a price cap on Russian crude oil exports.

An easing in China’s daily covid infections from an all-time high of 40,347 to 38,645 appeared to have triggered the market’s latest cautious optimism. On the same line could be the upbeat performance of Chinese equities as the national securities regulator lifted a ban on equity refinancing for listed property firms, per Reuters. “The China Securities Regulatory Commission (CSRC) said late on Monday it would broaden equity financing channels, including private share placements for China and Hong Kong-listed Chinese developers, lifting a ban that has been in place for years,” mentioned the news.

Elsewhere, Reuters quoted an anonymous diplomat from the bloc to highlight the deadlock surrounding the European Union’s (EU) push for restricting the price of Russian oil. “European Union governments failed to agree on Monday on a price cap on Russian seaborne crude oil, as Poland insisted that the cap had to be set lower than proposed by the G7 to cut Moscow's ability to finance its invasion of Ukraine, diplomats said,” reported Reuters.

On a different page, speculations that the global may aim for more production cuts also seemed to have favored the oil buyers of late. “The rumors of a possible cut outweighed an earlier sell-off built on the weak outlook out of China, where hundreds of demonstrators and police clashed on Sunday over strict COVID restrictions that have limited free moment among millions of residents,” per Reuters.

Against this backdrop, the US stock futures and equities in the Asia-Pacific region print mild gains despite the downbeat performance of Wall Street, which in turn favor riskier assets like WTI crude oil.

Moving on, developments surrounding the aforementioned risk catalysts will be crucial for WTI traders to watch. Also important will be the API Weekly Crude Oil Stock for the period ended on November 25, prior -4.8M.

Technical analysis

Despite the latest rebound, triggered mainly due to the oversold RSI conditions, the WTI crude oil remains on the bear’s radar unless crossing a three-week-old resistance line, near $80.25.

Additional important levels

Overview
Today last price	77.27
Today Daily Change	0.40
Today Daily Change %	0.52%
Today daily open	76.87

Trends
Daily SMA20	84.09
Daily SMA50	84.42
Daily SMA100	87.76
Daily SMA200	96.91

Levels
Previous Daily High	77.85
Previous Daily Low	73.66
Previous Weekly High	82.3
Previous Weekly Low	75.28
Previous Monthly High	92.63
Previous Monthly Low	79.32
Daily Fibonacci 38.2%	76.25
Daily Fibonacci 61.8%	75.26
Daily Pivot Point S1	74.4
Daily Pivot Point S2	71.93
Daily Pivot Point S3	70.21
Daily Pivot Point R1	78.6
Daily Pivot Point R2	80.32
Daily Pivot Point R3	82.79

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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