WTI Oscillating Above $ 60.00 As Traders Look To This Week’s OPEC + Meeting

• WTI has seen two-way price action in recent hours, oscillating between levels below $ 59.50 and close to $ 62.00.
• The Ever Given no longer blocks the Suez Canal, but the reaction from the crude oil market has been limited.
• Oil traders are looking towards this week’s OPEC + meeting and new pandemic developments in the US and the EU.

The futures contracts of the previous month for West Texas Intermediary (WTI), the US benchmark for light sweet crude, have seen two-way price action in recent hours, oscillating between levels below $ 59.50 and close to $ 62.00. Currently, WTI is trading near $ 61.00 and is flat on the day, and WTI is still within the range of $ 57.50 to $ 62.00 from last week. Given that the WTI has apparently found decent support ahead of its 50-day moving average at the $ 59.00 low, short-term crude oil market bulls could now be looking for a move towards the 21-day moving average modestly by. above $ 62.50, although that would require a break north of last week’s range, the high at $ 62.00.

Performance of the day

The news that the Suez Canal was finally unblocked, with the Ever Given resuming its journey after being on land for more than a week, does not appear to have had a lasting impact on crude oil markets. The main event of the week when it comes to crude oil markets will be the OPEC + meeting; Recent higher-than-usual levels of volatility in the crude oil market could continue to drive the meeting as various OPEC + sources filter the varied views of cartel members entering the discussions. Most agree that another increase in production is unlikely at this time given 1) demand concerns in Europe and elsewhere as a result of the return to lockdown and 2) the recent sharp drop in prices from the monthly highs (WTI is currently trading more than 13% below its March high of just under $ 68.00) – OPEC sources said last Wednesday that a renewal of current production levels is the most likely outcome.

But aside from OPEC +, factors on the demand side will also be in the spotlight. News from Europe remains pessimistic, and most EU countries have already substantially tightened restrictions as the bloc rushes to curb the third wave of Covid-19 cases, but the trajectory of the pandemic in the continent continues to point towards tougher restrictions in the future. German Chancellor Angela Merkel is reportedly prepared to force lenient states to tighten restrictions using federal law if necessary.

Meanwhile, the news in the UK is good – cases, deaths and hospitalizations still very low and the economy on track to reopen – and the news in the US is getting worse. Covid-19 cases are starting to rise steadily, driven by the growing dominance of the B.1.1.7 Covid-19 strain, which was first detected in Kent, UK and is now known to be up to a 70% more transmissible than the original Covid and up to 30% more lethal. The US Center for Disease Control (CDC) is concerned; CDC Director Rochelle Walensky said some states are opening at a rate the CDC would not recommend, and she will speak with state governors on Tuesday. The hope is that an increase in cases will not result in an increase in deaths, since the most vulnerable adults in the US have already been vaccinated. But deaths have risen somewhat and concerns that hospitals will again be overwhelmed could well trigger the re-imposition of restrictions. As has been the case in Europe, this would be terrible for oil demand in the short term.

Technical levels