WTI sits at 5-week tops ahead of EIA report, OPEC meeting

After having peaked at five-week highs of $ 51.76, oil futures on NYMEX are seen consolidating yesterday’s rally, as the bulls await the EIA crude inventory report for next push higher.    

The black gold keeps its upbeat momentum intact, as markets appear to have already priced-in an extension of the OPEC output cut deal until March 2018, as we remain a day away from the OPEC and non-OPEC producers meeting scheduled in Vienna.

Moreover, fading worries over Trump’s Budget proposing to sell 50% of strategic reserves, in the wake of Goldman Sach’s latest report, also buoys the sentiment around oil. Meanwhile, bullish API inventory data released late-Tuesday showed a draw of 1.5 million barrels in US crude oil stockpiles for the week ending May 19, which further collaborated to the upside in the commodity.

Markets now await the US EIA crude stockpiles report due ahead of the FOMC minutes in the NA session.

WTI technical levels 

A break above $ 52 (round number) could yield a test of $ 52.65 (May 19 high) beyond which $ 53 (round number) could be tested. While a breach of $ 51.05 (5-DMA) would expose $ 50.40 (200-DMA), below which downside opens up for a test of $ 49.90 (10-DMA).