Futures on US West Texas Intermediate Crude Oil eased from their recent near 88-month peak on Thursday, as investors took profits and after surprisingly weak US private sector employment data.
Still, the market remained supported by tight supply, as major oil producers stuck to their plan to raise output at a moderate rate.
Private payrolls dropped for the first time in 12 months in January, while raising concerns over a sharp decline in US employment.
“This morning’s dip might be a result of the shockingly low U.S. ADP employment print last night, but we believe the supply squeeze may drive oil prices higher through this year,” Howie Lee, economist at OCBC, was quoted as saying by Reuters.
Additional pressure on prices came after Iran’s Oil Minister announced the nation was prepared to return to the oil market as fast as possible.
Yesterday OPEC+ members agreed to continue increasing oil output by 400,000 barrels per day, as the group is struggling to meet existing targets.
“OPEC+ will save larger-than-expected production promises for when oil is over $100 a barrel,” OANDA senior market analyst Edward Moya said.
OPEC+ members said rising oil prices were a result of the failure of consuming nations to invest adequately in fossil fuels amid a shift towards greener energy.
According to a report by the OPEC+ Joint Technical Committee, overall surplus this year may be 1.3 million barrels per day, compared with a prior forecast of 1.4 million.
As of 10:16 GMT on Thursday WTI Crude Oil Futures were losing 1.03% to trade at $87.35 per barrel. Yesterday the black liquid rose as high as $89.72 per barrel, which has been its strongest price level since October 7th 2014 ($90.57 per barrel).
At the same time, Brent Oil Futures were losing 0.65% on the day to trade at $88.70 per barrel. Last Friday the commodity rose as high as $91.68 per barrel, which has been its strongest price level since October 9th 2014 ($91.82 per barrel).
Daily Pivot Levels (traditional method of calculation) – WTI Crude Oil Futures
Central Pivot – $88.36
R1 – $89.62
R2 – $90.98
R3 – $92.24
R4 – $93.50
S1 – $87.00
S2 – $85.74
S3 – $84.38
S4 – $83.02
Daily Pivot Levels (traditional method of calculation) – Brent Oil Futures
Central Pivot – $89.36
R1 – $90.40
R2 – $91.51
R3 – $92.55
R4 – $93.58
S1 – $88.25
S2 – $87.21
S3 – $86.10
S4 – $84.98