A sudden wave of selling pressure in crude oil prices is taking the West Texas Intermediate back to sub-$50.00 levels per barrel on Monday, or session lows.
WTI weaker after Iran rumours
Prices for the WTI took a dive today after Iranian oil minister Zanganeh said the country could reach 5 million bpd, helped by new Iranian Petroleum Contracts. The news adds to the already rising scepticism surrounding the deal on an output freeze clinched in Algiers, which should be confirmed at the next OPEC meeting in Vienna in November.
Adding to the downbeat mood around crude oil, Nigerian officials said the African oil producer could reach 2.2 million bpd by year-end.
Looking ahead, the API’s weekly report on crude stockpiles is due tomorrow ahead of the weekly report by the EIA (Wednesday) and US oil rig count by Baker Hughes due on Friday.
It is worth noting that according to the latest CFTC report, speculative net longs in crude oil have reached levels last seen in July 2014 above 413K contracts during the week ended on October 11. Back to the day, the WTI was trading above the $100 mark per barrel.
WTI levels to consider
At the moment the barrel of WTI is losing 1.41% at $49.64 facing the next support at $49.15 (low Oct.10) followed by $48.54 (20-day sma) and finally $46.36 (55-day sma). On the flip side, a surpass of $51.14 (high Sep.14) would expose $51.67 (2016 high Jun.6) and then $53.89 (high Jul.10).