Commodity Market: US Crude Oil retreats nearly 2% as markets expect an easing in oil supply cuts at upcoming OPEC+ meeting

Futures on US West Texas Intermediate Crude Oil retreated almost 2% on Monday, paring gains achieved on Friday, as market players awaited a technical meeting by OPEC at which oil supply reductions are expected to be eased.

The Ministerial Monitoring Committee, OPEC+’s production oversight group, will meet on July 14th and 15th to assess each member’s production cut adherence and discuss the next level of reductions. In June, OPEC+ compliance reached 107%, up from 77% in the preceding month.

Oil markets have seen a sound recovery from April lows after OPEC+ agreed to slash oil production by the record 9.7 million barrels per day between May and July. Markets now expect oil supply cuts to be eased to 7.7 million barrels per day, as global demand has recovered and oil prices have rebounded.

Last Friday both WTI Crude and Brent Oil registered their sharpest single-day advance since June 29th, after the International Energy Agency revised up its oil demand projection for 2020 by 400,000 barrels per day.

As a result of oil price recovery, some US producers resumed drilling operations, even as the number of oil and natural gas rigs under operation dropped for a tenth successive week.

As of 9:03 GMT on Monday WTI Crude Oil Futures were losing 1.86% to trade at $39.83 per barrel, while moving within a daily range of $39.74-$40.57. WTI Crude Futures gained 0.87% last week, following a 5.38% surge in the preceding week.

Brent Oil Futures were losing 1.48% on the day to trade at $42.62 per barrel, while moving within a daily range of $42.54-$43.20. Brent Oil Futures went up 1.17% last week, following a 5.06% surge in the prior week.

Daily Pivot Levels (traditional method of calculation) – WTI Crude Oil Futures

Central Pivot – $39.96
R1 – $41.36
R2 – $42.14
R3 – $43.54
R4 – $44.94

S1 – $39.18
S2 – $37.78
S3 – $37.00
S4 – $36.22

Daily Pivot Levels (traditional method of calculation) – Brent Oil Futures

Central Pivot – $42.67
R1 – $43.99
R2 – $44.73
R3 – $46.05
R4 – $47.38

S1 – $41.93
S2 – $40.61
S3 – $39.87
S4 – $39.14