Futures on US West Texas Intermediate Crude Oil snapped a three-day streak of gains on Thursday amid renewed demand concerns stemming from the spread of the novel coronavirus and as oil output returned in Mexico.
New outbreaks caused by the Delta variant of the coronavirus raised concerns over the strength of global economic recovery.
“Although prices had reversed strongly … questions remain on how the ever-surging number of cases globally will impact fuel demand,” Avtar Sandu, senior manager commodities at Phillip Futures in Singapore, was quoted as saying by Reuters.
Meanwhile, the return of oil production in Mexico also weighed on prices. Last weekend a fire on an offshore platform caused the death of at least five workers and cut output by a bit over 400,000 barrels per day. So far, Pemex has recovered 71,000 barrels per day of output and anticipates to add 110,000 barrels per day more in the near-term.
Yesterday the US Energy Information Administration reported that US crude oil stocks had risen last week for a third straight period, while overall fuel demand rose to levels not seen since March 2020, supporting oil prices.
Still, some remain skeptical about demand outlook.
“For now, U.S. consumers appear to be shrugging off the spread of the Delta variant … However, it seems likely that we are near the peak in U.S. demand, which will act as a lid on oil prices,” Capital Economics pointed out in an investor note.
As of 8:30 GMT on Thursday WTI Crude Oil Futures were retreating 1.24% to trade at $67.51 per barrel, after climbing as high as $68.54 per barrel yesterday. The latter has been the commodity’s strongest price level since August 13th ($69.22 per barrel). WTI Crude Oil Futures have retreated 8.57% so far in August, following a 0.65% gain in July.
At the same time, Brent Oil Futures were losing 0.60% on the day to trade at $71.51 per barrel, after climbing as high as $72.40 per barrel yesterday. The latter has been the black liquid’s strongest price level since August 6th ($72.41 per barrel). Brent Oil Futures have retreated 4.82% so far in August, following a 0.70% gain in July.
Daily Pivot Levels (traditional method of calculation) – WTI Crude Oil Futures
Central Pivot – $67.94
R1 – $68.96
R2 – $69.56
R3 – $70.58
R4 – $71.60
S1 – $67.34
S2 – $66.32
S3 – $65.72
S4 – $65.12
Daily Pivot Levels (traditional method of calculation) – Brent Oil Futures
Central Pivot – $71.63
R1 – $72.71
R2 – $73.49
R3 – $74.57
R4 – $75.66
S1 – $70.85
S2 – $69.77
S3 – $68.99
S4 – $68.22