Commodity Market: US Crude Oil extends gains as OPEC+ may decide not to raise output

Futures on US West Texas Intermediate Crude Oil extended gains from the previous trading day on Thursday, as OPEC+ producers may decide to stick with oil output cuts at a meeting later today, which provided support to oil prices.

The Organization of the Petroleum Exporting Countries and allies, known as OPEC+, may roll over production cuts into April instead of increasing output, since oil demand recovery is still fragile due to the pandemic, a report by Reuters stated.

Market players had been anticipating the group to ease output cuts by 500,000 barrels per day from April.

Citigroup analysts said they expected OPEC leader Saudi Arabia to hold on its voluntary production cut of 994,000 barrels per day, which would maintain the country’s production quota at 8.256 million barrels per day.

Additional support to oil prices came after Yemen’s Houthi forces said earlier today that they had launched a missile at a Saudi Aramco facility in Saudi Arabia’s Red Sea city of Jeddah.

Meanwhile, an official report by the Energy Information Administration (EIA) showed yesterday that US crude oil stocks had risen by 21.563 million barrels during the business week ended February 26th, which has been the biggest increase on record.

At the same time, gasoline inventories decreased by 13.624 million barrels last week, or at the steepest rate in at least 30 years, with refining operations shrinking to a record low because of the Texas freeze.

As of 9:14 GMT on Thursday WTI Crude Oil Futures were edging up 0.13% to trade at $61.36 per barrel, while moving within a daily range of $60.67-$61.98 per barrel. Prices rebounded from $59.24 per barrel, or WTI’s weakest level since February 22nd ($58.82 per barrel). Still, WTI Crude Oil Futures have retreated 1.15% so far in March, following a 17.82% surge in February.

Brent Oil Futures were edging up 0.47% on the day to trade at $64.18 per barrel, while moving within a daily range of $63.44-$64.85 per barrel. Prices rebounded from $62.40 per barrel, or Brent’s weakest level since February 19th ($62.12 per barrel). Still, Brent Oil Futures have retreated 0.75% so far in March, following a 17.09% surge in February.

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

Central Pivot – $60.84
R1 – $62.43
R2 – $63.59
R3 – $65.18
R4 – $66.78

S1 – $59.68
S2 – $58.09
S3 – $56.93
S4 – $55.78

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

Central Pivot – $63.65
R1 – $64.91
R2 – $65.93
R3 – $67.19
R4 – $68.44

S1 – $62.63
S2 – $61.37
S3 – $60.35
S4 – $59.32