- A 10% drop in US crude production propels WTI to new yearly highs.
- Reflation trading boosts US Treasury yields.
- OPEC + is considering a slight increase in production, which limits the advance in WTI prices.
The WTI (futures on NYMEX) has retraced near the $ 63.20 region after hitting new 13-month highs at $ 63.78 at the start of the European session on Thursday.
The pullback could be seen as a sign of a slight bullish exhaustion, as buyers catch their breath before picking up momentum for a break above the $ 64.00 level. US oil is still on track for a weekly gain after ending the previous week negative.
Black gold continues receiving support from the weekly report from the Energy Information Administration (EIA) released on Wednesday, which showed that US crude production fell 10%as operations reached their lowest levels since 2008 due to a winter storm in Texas.
What’s more, Rising risk appetite in global equities, following reflation, supports oil as riskier asset perceived. The further rise appears to have stalled for now, though, as US Treasury yields weigh on the attractiveness of oil as a higher-yielding alternative asset.
What’s more, the news that OPEC and its allies (OPEC +) are planning a modest boost to production of oil at 500,000 barrels per day (bpd), also keep investors nervous. The focus is now on the US durable goods data and the GDP report for a new momentum around the USD, which could affect dollar-denominated oil prices.
WTI technical levels
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