Commodity Market: US Crude Oil extends gains as compliance with OPEC+ output cuts seen at 97% in July

Futures on US West Texas Intermediate Crude Oil extended gains from the prior trading day on Tuesday after the Organization of the Petroleum Exporting Countries and allies, collectively known as OPEC+, said members were almost entirely complying with production cuts in support of oil market as fuel demand remains subdued due to the pandemic.

OPEC+ said that compliance with previously agreed oil production cuts was at around 97% in July.

OPEC+ agreed to ease output cuts to 7.7 million barrels per day, starting in August, from 9.7 million barrels per day previously.

Oil prices have been on the rise since early May, which led companies such as BHP to be more optimistic about oil market outlook.

“We believe that the most significant risks to the physical (oil) market have now passed,” the Australia-based mining company said. “Prices may well build upon their recent recovery, if mobility continues to improve globally.”

However, BHP also said that “the pace of gains though could be modest given potential headwinds from supply returning.”

The weekly report on US oil stockpiles by the American Petroleum Institute industry group is expected to be released at 20:30 GMT today.

As of 9:07 GMT on Tuesday WTI Crude Oil Futures were edging up 0.28% to trade at $42.85 per barrel, while moving within a daily range of $42.57-$42.97. WTI Crude Futures rose 1.54% in July, which marked their third straight month of gains. US Oil has risen another 6.08% so far in August.

Brent Oil Futures were edging up 0.33% on the day to trade at $45.40 per barrel, while moving within a daily range of $45.12-$45.52. Brent Oil Futures rose 4.86% in July, which marked their fourth consecutive month of advance. UK Oil has risen another 4.22% so far in August.

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

Central Pivot – $42.50
R1 – $43.17
R2 – $43.62
R3 – $44.29
R4 – $44.97

S1 – $42.05
S2 – $41.38
S3 – $40.93
S4 – $40.49

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

Central Pivot – $45.06
R1 – $45.57
R2 – $45.90
R3 – $46.41
R4 – $46.93

S1 – $44.73
S2 – $44.22
S3 – $43.89
S4 – $43.57