WTI down to test $ 54, ignores Saudi OilMin’s comments

• Extends consolidative mode near 54 handle.
• USD recovers losses.

WTI (oil futures on NYMEX) broke to the downside from its latest consolidative mode, but manages to hold $ 54 threshold amid a broad-based USD recovery.

WTI back below 5-DMA at $ 54.19

The black gold met fresh supply over the last hour after the greenback staged a tepid recovery against its major peers in tandem with the US rates. The US dollar slumped across the board in Asia on reports of a temporary corporate tax cut news.

Meanwhile, the oil markets also ignored upbeat comments from the Saudi Arabian Energy Minister Al-Falih, as he said that the Kingdom sees the  OPEC renewing resolve to normalize oil stockpile.

However, the downside is expected to remain capped by tightening US markets and hopes of the OPEC cuts extension beyond March 2018. Meanwhile, bullish EIA crude inventory report will also keep the sentiment buoyed around the black gold. The EIA weekly data showed that the US commercial crude oil inventories fell by 2.4 million barrels in the week to Oct. 27 to 454.9 million barrels.

At the time of writing, WTI drops -0.39% to $ 54.09, while Brent is down -0.55% to $60.15.

WTI Technical Levels

Higher-side levels: 55.24 (Jan highs), $ 55.50 (psychological levels), $ 56.00 (round number)

Lower-side levels: 53.90/75 (key support), 53.40 (10-DMA), 53.12 (classic S2/ Fib S3)