WTI retreats from high after news of OPEC production cut deal

Haresh Menghani FXStreet

Having surged beyond $49.00/barrel mark, WTI crude oil eased from session peak and has now retreated back to mid-$48.00s.

The black gold failed to attract fresh buying interest after the much anticipated headlines (via Bloomberg - citing OPEC delegates) that members of the cartel have reached an agreement to cut oil production by 1.2 mbpd to 32.5 mbpd. Earlier on Wednesday, the commodity soared beyond $49.00 mark to a 6-day high after comments from Saudi Energy Minister and Iraq oil minister fueled optimism over output cut deal.

Markets now look forward to the official details, as to who will cut and by how much, and whether the deal is conditional to agreement by non-OPEC countries, including Russia. Also in focus would be the EIA's official weekly US inventory data, which is likely to be overshadowed by news / developments surrounding the OPEC deal.

Technical levels to watch

Immediate upside resistance is pegged at $49.20 level (Nov. 22 high) above which the commodity seems all set to aim towards testing $50.00 psychological mark. On the downside, weakness below $48.00 mark could accelerate the profit-taking slide towards $47.35-30 support area ahead of $47.00 handle.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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