Futures on US West Texas Intermediate Crude Oil extended gains from the prior trading day on Tuesday as another tropical storm was forming in the Gulf of Mexico and posed a threat to oil facilities there, while markets were also relieved by news of US President Trump’s discharge from hospital.
Yesterday WTI Crude Futures registered their sharpest single-day gain since May 18th, rising 5.9%, due to growing optimism over a new US coronavirus relief package and reports of US President Trump’s return to the White House after COVID-19 treatment, which eased concerns over what would happen in the country during the weeks prior to the presidential election.
Oil prices were also supported by news of evacuation of oil rigs in the Gulf of Mexico as Tropical Storm Delta was approaching the Louisiana and Florida coast. Additionally, a spreading labour strike in Norway added to concerns over oil supply.
“It’s the supply-side factors that have changed in the last 24 hours and are contributing more to the uplift,” Lachlan Shaw, head of commodity research at National Australia Bank, said.
Meanwhile, investor optimism regarding a coronavirus aid deal in the United States rose after House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin spoke over the phone on Monday and scheduled more talks for Tuesday.
White House Chief of Staff Mark Meadows said there was still potential for a deal on more economic relief, as he underscored President Trump’s commitment to ensure an agreement is reached.
“There’s better (fuel) demand sentiment surrounding the potential for U.S. fiscal agreement, and perhaps President Trump leaving hospital might drive a bit of impetus to conclude a deal there,” NAB’s Shaw said.
As of 8:50 GMT on Tuesday WTI Crude Oil Futures were edging up 0.43% to trade at $39.39 per barrel, while moving within a daily range of $39.10-$39.61 per barrel. WTI Crude Futures have retreated 1.97% so far in October, following a 5.61% slump in September.
Brent Oil Futures were edging up 0.24% on the day to trade at $41.62 per barrel, while moving within a daily range of $41.24-$41.68 per barrel. Brent Oil Futures have retreated 1.14% so far in October, following a 7.55% loss in September.
Daily Pivot Levels (traditional method of calculation) – WTI Crude Oil Futures
Central Pivot – $38.65
R1 – $40.29
R2 – $41.37
R3 – $43.01
R4 – $44.66
S1 – $37.57
S2 – $35.93
S3 – $34.85
S4 – $33.78
Daily Pivot Levels (traditional method of calculation) – Brent Oil Futures
Central Pivot – $40.81
R1 – $42.47
R2 – $43.41
R3 – $45.07
R4 – $46.72
S1 – $39.87
S2 – $38.21
S3 – $37.27
S4 – $36.32