WTI Crude Prices Under Pressure on Rising Production – Outlook Still Positive
Oil prices were stable on Wednesday, supported by healthy economic growth and expectations that a weaker dollar could spur fuel demand.
U.S. West Texas Intermediate (WTI) crude futures were at $59.05 a barrel at 0725 GMT, down 14 cents from their last settlement. WTI was trading above $65 in early February.
Brent crude futures were at $62.69 per barrel, up 3 cents from their last close. Brent was above $70 a barrel earlier this month.
Ongoing weakness in the U.S. dollar, which potentially stokes demand from countries using other currencies, as well as healthy economic growth was supporting oil markets, traders said.
Overnight, crude oil prices settled lower for a second straight day after the International Energy Agency’s gloomy monthly report stoked investor fears that rising US oil output would derail OPEC’s efforts to rebalance the market.
Oil production has risen by 5 million barrels per day (bpd) since 2010, an increase of nearly 100 percent. New technology, particular techniques in shale oil drilling, has opened up vast new opportunities for oil and gas companies.
In 2019, the EIA expects U.S. production to average 10.8 million bpd, which will allow the U.S. to rival Saudi Arabia and Russia as the world’s largest oil producer.
On the technical charts, WTI crude is trading in the negative zone, below all the moving averages (9day, 20 day, 50 day and 100 day). The RSI is at 34.51 and the MACD is below the signal line. the market is expected to stay under selling pressure for a day.
Sell stop at 59.09, Take profit at 58.54, Stop loss at 59.36