WTI Crude Oil trades near $64.60 level at 13:00 GMT and the oil traders are waiting for the US EIA weekly inventories report at 14:30 GMT to give direction on the today’s oil trading session.
- WTI Crude Oil has been correcting since yesterday after the last week rally which the price climbed from the lows of $60 to highs of $66. The main reasons of the correction are the investors have took some profits from the last rally, and the Geopolitical tensions have already discounted at the moment.Furthermore the strenght of the US dollar and the last night tumble of the US indices accelerated the selling pressure on the WTI contract.
- Oil investors are expecting the EIA weekly Inventory report today at 14:30 GMT while the last night’s API report showed a huge 5.3 million barrels inventory.
- Iran Sanctions: The positive environment for Oil started when the US president mr. Trump replace the Secretary of State mr Tillerson with the more Iran hawkish mr Pompeo at the start of March, signaling the raise of risk of US re-introduction of the Oil sanctions against Iran which would be announced at May 12 , 2018 and further sanctions against Venezuela and North Korea. Furthermore, the Saudi Arabia Crown Prince mr Salman met with mr Trump last week in Washington DC, discussing the possibilities the US to walk away from the Iran Nuclear deal , hurting the Iran’s ability to produce and export crude oil.
- The COT report for the week ended March 20, indicates that the Hedge Funds are very bullish on the WTI and Brent contracts betting on the rising Geopolitical tensions. This combination of the record long positions on the top of the current trend which failed to break, the almost overbought RSI could signal alert for the oil market and possible short term reversal and many stop losses.
WTI Crude Oil failed to break and move above the January highs of $66.60 , creating a double top formation with the price correcting below the $65 triggering from some profit taking trades.Possible negative effect from the today EIA Inventory report could trigger new selling pressure leading the price towards $62-$63 support levels.Any positive report would send the price to retest the previews highs of $66.60.