- The WTI goes back despite the disappointment in the inventories of the EIA.
- Opec+ supply increases exceed the reduction of US oil inventories in the short term, pushing WTI towards the mobile average support.
- Momentum indicators suggest that short -term price action can remain favorable for bassists below $ 65.00.
WTI crude oil is quoting under pressure despite a reduction greater than expected in US crude oil inventories on Wednesday, since the growing concerns about supply and demand continue to limit the upward movement. At the time of writing, the WTI is traded at $ 65.14.
Although the data of the Energy Information Administration (EIA) were fundamentally favorable, the moderate to negative price reaction indicates that the feeling is cautious, and the operators may be focusing more on the winds against macroeconomic or technical resistance.
EIA published its latest weekly inventory report on Wednesday, which reflected a reduction greater than expected in inventories. After an unexpected increase of 7.07 million last week, analysts expected the data to show a reduction of 1.8 million barrels this week. However, real figures reflected that inventories fell to 3,859 million barrels, exceeding expectations.
However, the API and the Opec+ reports published on Tuesday reflected that the offer remains firm, restricting the upward potential for the WTI.
A decisive breakdown below $ 64.18 could invite more sales, while staying above this level could keep the bulls at stake.
The WTI could not maintain profits above the Fibonacci recoil level of 50.0% of the fall from January to April at $ 67.08 on Monday and since then it has retreated around $ 65.25.
This setback highlights the weakening of the bullish impulse, also evidenced by repeated rejection about $ 67.00 and a break below the ascending trend line.
The price is now close to the fibonacci setback of 38.2% in $ 64.18, a critical technical area also backed by the convergence of the simple mobile average (SMA) of 50 days at 64.87 $ and the 100 -day SMA at $ 64.78, which are providing support. The relative force index (RSI) marks 47, indicating a neutral momentum with a slight bassist inclination.
Although the EIA data suggests an adjustment in the offer, the technical image urges caution, with the 64.75 $ –65.00 $ area probably playing a key role in the short -term address.
WTI oil – frequent questions
WTI oil is a type of crude oil that is sold in international markets. WTI are the acronym of West Texas Intermediate, one of the three main types that include the Brent and Dubai’s crude. The WTI is also known as “light” and “sweet” by its relatively low gravity and sulfur content, respectively. It is considered high quality oil that is easily refined. It is obtained in the United States and is distributed through the Cushing Center, considered “the crossing of the world.” It is a reference for the oil market and the price of WTI is frequently traded in the media.
Like all assets, supply and demand are the main factors that determine the price of WTI oil. As such, global growth can be a driver of the increase in demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can alter the offer and have an impact on prices. OPEC decisions, a group of large oil -producing countries, is another key price factor. The value of the US dollar influences the price of WTI crude oil, since oil is mainly traded in US dollars, so a weaker dollar can make oil more affordable and vice versa.
Weekly reports on oil inventories published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect the fluctuation of supply and demand. If the data show a decrease in inventories, it can indicate an increase in demand, which would raise the price of oil. An increase in inventories may reflect an increase in supply, which makes prices lower. The API report is published every Tuesday and that of the EIA the next day. Their results are usually similar, with a 1% difference between them 75% of the time. EIA data is considered more reliable, since it is a government agency.
The OPEC (Organization of Petroleum Exporting Countries) is a group of 13 nations oil producing that collectively decide the production quotas of member countries in biannual meetings. Their decisions usually influence WTI oil prices. When OPEC decides to reduce fees, it can restrict the supply and raise oil prices. When OPEC increases production, the opposite effect occurs. The OPEC+ is an expanded group that includes another ten non -members of the OPEC, among which Russia stands out.
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.
