Market news
03.06.2024, 19:25

Crude Oil extends declines after OPEC+ disappoints barrel traders, WTI tests $74

  • WTI backslid to $74.00 per barrel after OPEC+ failed to bolster Crude trader hopes.
  • Voluntary production cuts are slated to be phased out beginning in October.
  • OPEC voluntary cuts have kept 2.2 million bpd off the market since 2022.

Crude Oil prices tumbled on Monday after an update on voluntary production cuts didn’t go how energy traders had hoped last week. The Organization of the Petroleum Exporting Countries (OPEC) and its extended network of non-member allies, OPEC+, announced the beginning of a phase-out of long-running production caps. The phase-out is slated to begin in October.

OPEC+ has been participating in voluntary Crude Oil production cuts that have kept 2.2 million barrels per day off the markets in an attempt to bolster global barrel prices in the face of global Crude Oil output that has grown to outpace demand. However, key members of OPEC+ who rely on selling Crude Oil in order to balance their government budgets have balked at the idea of continuing to support global prices at the expense of their solvency, and are set to begin phasing out currently-standing production limits sometime in October. OPEC+ stipulated that ending production limits will be data-dependent heading closer to October, but energy traders promptly sold off Crude Oil as barrels slated for year-end delivery become an unappealing bet.

US Crude Oil traders will be looking ahead to weekly updates on barrel counts from the American Petroleum Insitute (API) and the Energy Information Administration (EIA), due on Tuesday and Wednesday, respectively. Last week’s updates showed a sharp pullback in Crude Oil supplies, but inventories in upstream refined Crude Oil products spiked after a widely-expected uptick in US Crude Oil demand at the beginning of the Memorial Day driving season failed to materialize, leaving refineries with far more inventory than expected.

WTI technical outlook

WTI tumbled to its lowest prices since February, extending a bearish slide into the $74.00 per barrel handle and declining 8% from last week’s peak near $80.40 per barrel. Intraday short pressure cleanly snapped a technical barrier at $77.00, and a long-standing demand zone from $77.00 to $76.00 could rotate to form a heavy supply zone following any profit-taking from rebound bets.

US Crude Oil is poised for its single worst day in 2024, in the red nearly 4% from the day’s opening bids near $77.00 and testing into lows last set during the first week of February. WTI is down 15% from 2024’s peaks near $87.00.

WTI hourly chart

WTI daily chart

WTI US OIL

Overview
Today last price 74.08
Today Daily Change -2.92
Today Daily Change % -3.79
Today daily open 77
 
Trends
Daily SMA20 78.38
Daily SMA50 81.17
Daily SMA100 79.05
Daily SMA200 79.56
 
Levels
Previous Daily High 78.45
Previous Daily Low 76.52
Previous Weekly High 80.41
Previous Weekly Low 76.52
Previous Monthly High 81.25
Previous Monthly Low 76.04
Daily Fibonacci 38.2% 77.25
Daily Fibonacci 61.8% 77.71
Daily Pivot Point S1 76.19
Daily Pivot Point S2 75.39
Daily Pivot Point S3 74.26
Daily Pivot Point R1 78.12
Daily Pivot Point R2 79.25
Daily Pivot Point R3 80.05

 

 

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