Futures on US West Texas Intermediate Crude Oil extended losses from the prior two trading days on Thursday, as this week’s talks between key oil producers collapsed.
Negotiations between members of the Organization of the Petroleum Exporting Countries and allies, a group known as OPEC+, fell apart when Saudi Arabia refused demands from the United Arab Emirates to increase its output under OPEC+ supply cut agreement.
“The oil market is looking beyond the oil supply deficit in August and expecting the OPEC+ agreement to fall apart well before April 2022 when the agreement expires as other member countries will ask for further concessions to secure more market share,” Edward Moya, senior market analyst at OANDA, was quoted as saying by Reuters.
Currently, OPEC+ members are maintaining 6 million barrels per day of production cuts, while analysts expected that the group would add to supply.
Meanwhile, the market received certain support on the back of a sharp drop in US crude stocks. The American Petroleum Institute (API) reported on Wednesday that US crude oil inventories had decreased by 7.983 million barrels during the week ended July 2nd. A consensus of analyst estimates had pointed to a much smaller drop, by 3.925 million barrels.
The official report on oil inventories by the US Energy Information Administration (EIA) is scheduled to be released later today.
The EIA said on Wednesday that it now expected US oil production to reach 11.10 million barrels per day in 2021, or a decrease by 210,000 barrels per day compared to a year ago. Previously, it had forecast a 230,000 barrel drop.
As of 8:13 GMT on Thursday WTI Crude Oil Futures were retreating 1.51% to trade at $71.11 per barrel, after earlier touching an intraday low at $71.05 per barrel. The latter has been the black liquid’s weakest price level since June 21st ($70.78 per barrel). WTI Crude Oil Futures have retreated 3.25% so far in July, following a 10.78% surge in June.
At the same time, Brent Oil Futures were losing 1.35% on the day to trade at $72.36 per barrel, after earlier touching an intraday low at $72.32 per barrel. The latter has been the commodity’s weakest price level since June 18th ($72.20 per barrel). Brent Oil Futures have retreated 3.12% so far in July, following a 7.49% surge in June.
Daily Pivot Levels (traditional method of calculation) – WTI Crude Oil Futures
Central Pivot – $72.71
R1 – $74.35
R2 – $76.50
R3 – $78.14
R4 – $79.78
S1 – $70.56
S2 – $68.92
S3 – $66.77
S4 – $64.62
Daily Pivot Levels (traditional method of calculation) – Brent Oil Futures
Central Pivot – $73.98
R1 – $75.35
R2 – $77.34
R3 – $78.71
R4 – $80.07
S1 – $71.99
S2 – $70.62
S3 – $68.63
S4 – $66.63