WTI sinks over 2% ahead of oil rig count

Prices for the barrel of the American reference for the sweet light crude oil are retreating sharply on Friday, testing the lower bound of the weekly range in the $44.30/20 band.

WTI weaker ahead of payrolls, Baker Hughes

Prices of the WTI are retreating for the third consecutive session so far today after being rejected from recent tops in the $47.00 neighbourhood, where sits the 55-day sma.

The June-July rally that saw the barrel of WTI climbing from the $42.00 area to as high as $47.30 (July 4) have come to a sudden halt after concerns over the supply glut seem to have re-emerged among traders, despite this week’s report from the API (Wednesday) and the EIA (Thursday) saw crude oil and gasoline supplies dropping more than initially forecasted.

In addition, the omnipresent (and rising) skepticism over the ability of the OPEC deal to re-balance the oil market keep weighing on sentiment and limits the extension of any bullish attempt.

Ahead in the session, crude oil prices are poised to stay under pressure in light of June’s US non-farm payrolls and the G20 meeting, where President D.Trump is expected to meet President V.Putin later in the day.

WTI levels to consider

At the moment the barrel of WTI is losing 2.53% at $44.37 and a break below $42.05 (2017 low Jun.21) would aim for $41.10 (low Aug.11 2016) and finally $39.19 (low Aug.3 2016). On the upside, the initial hurdle aligns at 445.85 (38.2% Fibo of the May-June decline) followed by $47.05 (55-day sma) and then $47.31 (high Jul.4).