Wti Bullish Streak At Risk As It Trades Near Support

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Wti Bullish Streak At Risk As It Trades Near Support

WTI's Bullish Streak At Risk As It Trades Near $77.70

WTI was on a bullish path for the last 3 days, but it seems to have come to an end. For now, the WTI is trading around the $77.70 handle, with a chance of more downside later today. According to experts, the buildup of crude stockpiles in the USA is the reason behind the downward pressure seen in the WTI.

If we look at the API report, it showed an increase of 9.047 million barrels in the US stockpiles. Earlier, the reading was around 1.335 million barrels, which suggests that the demand for crude oil has slowed down in the USA.

Oil Demand Slowdown In USA

On the one hand, the OPEC+ members announced supply cuts, which supported the oil markets. On the other hand, the news of the buildup of the US stockpiles pushed the oil markets lower. In the end, it seems that the bearish pressure has prevailed as the oil market is now at risk of losing its earlier gains.

On Monday, reports surfaced that many OPEC+ members are thinking about deepening the supply cuts to support higher oil prices. The decision was made on account of weak global growth and the higher geopolitical tension.

According to the market players, OPEC+ is expected to stick with supply cuts even into late 2024. On the contrary, the head of the IEA is pointing towards a little bit of supply surplus in the next year (2024).

The bottom line is that we will have to wait and see how the OPEC+ meeting unfolds. On the other hand, we already have solid proof of slow demand and a higher supply in the USA.

So, it makes sense for the WTI to turn lower as the markets await the highly anticipated OPEC+ meeting due in the next few days. For now, the 20 SMA on the WTI chart (daily) is near 79.23, while the long-term 200 SMA is near 77.96.

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