- Crude oil retreated on Wednesday after an initial rise.
- US crude oil values continue to accumulate faster than markets anticipated.
- Geopolitical headlines put a floor on barrel prices.
US WTI crude oil hit multi-week highs near $78.50 in the early hours of Wednesday, before the US barrel count again showed a surprise build, sending bids for crude oil tumbling again. WTI fell back below $77.00 per barrel, after the Energy Information Administration (EIA) showed a crude oil oversupply of millions of barrels in US markets, which investors had not anticipated, and which affected the overall energy market narrative about global supply constraints, which remain unrealized.
According to the EIA on Wednesday, US crude oil inventories rose by 12.018 million barrels in the week ended February 9, well above the forecast increase of 2.6 million barrels and adding to the buildup of the previous week of 5,521 million barrels.
This figure is added to the 8.52 million barrels recorded on Tuesday by the American Petroleum Institute (API). The EIA reported the largest one-week increase in barrels in the last 12 months, while the API increase was the largest since November.
Crude Oil's decline remains limited as geopolitical headlines continue to weigh on investors, keeping barrel bids on the high side as investors begin to become more concerned about the decreasing likelihood of a cessation of hostilities in the current Gaza conflict between Israel and Palestinian Hamas.
WTI Technical Outlook
Despite hitting the highest bids in nearly three weeks, WTI suffered a sharp pullback on Wednesday, sending US crude oil to its first day lower after seven consecutive closes in the green. WTI marked an intraday high of $78.43 before returning below $77.00 to test $76.50.
Wednesday's pullback sees US crude oil forming a bearish rejection of the 200-day SMA near 77.40%, and WTI risks continuing to churn within a consolidation zone between the 200-day SMA and the 50-day SMA near $73.55.
WTI hourly chart
WTI daily chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
