WTI under pressure near $23.00 ahead of API

Prices of the WTI stay depressed near $23.00.
Rumours of a US-Saudi Arabia deal remain on the rise.
The API’s weekly report on US crude oil supplies is coming up next.

Pablo Piovano FXStreet

Prices of the WTI are giving away Monday’s gains and are trading just above the $23.00 mark per barrel at the time of writing.

WTI looks to data, Fed easing

Prices of the barrel of the American reference for the sweet light crude oil have returned to the negative territory on Tuesday, extending the consolidative/cautious stance in the lower end of the recent range.

In the meantime, crude oil remains sceptical on the likelihood that the US and Saudi Arabia could reach an agreement in order to bring in some stability to the oil markets, all amidst the ongoing price war between Russia and the Kingdom.

Same scepticism seems to prevail among oil traders regarding the recently announced extra easing measures by the Federal Reserve, with equities seem to be taking all the benefits for the time being.

Later in the NA session, the American Petroleum Institute (API) will publish its weekly report on US crude oil supplies ahead of the DoE’s official report on Wednesday.

What to look for around WTI

Crude oil prices remain under heavy pressure in a context of heightened volatility and thin liquidity. As usual in the past weeks, prices of the commodity are hurt by a combination of demand and supply side drivers coming from the ongoing (and future) impact of the coronavirus on the global economy and the unabated Saudi Arabia-Russia price war, aggravated by the palpable possibility that the Kingdom could ramp up production to a record of 12.3Mbpd as soon as in April. A potential relief to this low-prices-scenario could come in the form of a US intervention, which is expected to morph into some sort of agreement between the US, Russia and Saudi Arabia, all aimed to bring in stabilization to the oil market.

WTI significant levels

At the moment the barrel of WTI is retreating 1.61% at $23.62 and a breach of $20.08 (2020 low Mar.18) would expose $17.12 (monthly low November 2001) and finally $10.65 (monthly low December 1998). On the upside, the next resistance aligns at $28.46 (high Mar.20) seconded by $36.09 (21-day SMA) and then $36.28 (high Mar.11).

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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