WTI slides for fourth straight days as USD rebounds amidst OPEC+ uncertainty
- WTI marks a four-day decline, impacted by Greenback's recovery and demand-supply dynamics.
- OPEC+ agrees on 2.2 million bpd cuts for Q1 2024; Russia hints at potential deeper production cuts to curb speculation.
- Putin's caution on delayed impact of cuts follows November's revenue dip, Saudi Arabia cuts prices to Asian customers in January 2024.
Due to several factors, the US Crude Oil benchmark, known as WTI, extended its losses to four straight days. Firstly, the Greenback is staging a recovery, while Oil’s seesawed after demand concerns offset supply worries after Russia said OPEC+ was ready to deepen cuts in the first quarter of 2024. WTI is trading at $72.72 per barrel, down 0.41%.
Oil markets face headwinds as demand worries counter OPEC+ supply cuts; WTI trades at $72.72, down 0.41%
In the latest OPEC+ meeting on November 30, members agreed to output cuts of 2.2 million barrels per day (bpd) for the first quarter of 2024, with 1.3 million of those provided by an extension of Saudi Arabia and Russia's voluntary cuts already in place since August 2023.
Despite that, Russian Deputy Prime Minister Alexander Novak stated that OPEC+ could deepen production cuts, to eliminate “speculation and volatility.”
Recently, Russia’s President Vladimir Putin said that cuts would take time to begin, as its revenues in November fell to 961.7 billion roubles ($10.53 billion) from 1.635 trillion roubles in the previous month.
In the meantime, Saudia Arabia is curbing its prices to Asian customers in January 2024 for the first time since June 2023.
WTI Price Analysis: Technical outlook
From a technical perspective, WTI is testing the lows of November 2023 and is about to form a double bottom if prices remain firm above $72.00. In that outcome, WTI's first resistance would be today’s high at $74.00, followed by the December 4 high at $75.00. A breach of those two levels would expose the 200-day moving average (DMA) at $78.03, ahead of the $80.00 threshold.