- WTI extends Thursday’s turnaround as a test of the $ 80 level looks imminent.
- The persistent contraction of energy supply and the switch from gas to oil support the price of US WTI oil.
- Doubts about the release of oil by the United States from its strategic reserves underpin the rise in the WTI.
The WTI (NYMEX futures) remains near highs around $ 79.60, firmly supported by fundamental factors that favor the bulls.
WTI backs off on cautious sentiment, but upside risks persist
At the time of writing, WTI is trading at $ 79.22 and up 0.81% on the day, prepared for a weekly profit of 5%.
The small decline in black gold could be attributed to cautious market sentiment, due to the resurgence of concerns about China’s debt-laden real estate sector and a typical pre-NFP cautionary trade.
Nevertheless, underlying bullish momentum in US oil remains intact amid some signs of declining power supply contraction. Additionally, increased demand for oil, as some industries switch from high-cost natural gas to oil, also underpins sentiment around WTI.
The price of oil also benefited from a statement from the US Department of Energy, which cited that has no plans “at this time” to tap into strategic oil reserves to curb the rise in black gold.
The passage of the US debt ceiling bill also encouraged investors, who seek higher-yielding assets such as oil, to find trading opportunities.
Markets are now awaiting the release of the US NFP for further indications of the Fed’s next monetary policy move, which is likely to have a significant impact on markets, ultimately influencing oil prices.
WTI technical levels