WTI moves higher near $46.00 ahead of EIA

Crude oil prices have recovered part of Wednesday’s sharp pullback, with the West Texas Intermediate hovering over the $46.00 mark per barrel ahead of the EIA’s report.

WTI attention to EIA

Prices for the WTI moved higher today after the API reported late on Wednesday a larger-than-expected draw in US crude oil supplies. In fact, inventories unexpectedly dropped by more than 5.7 million barrels during the week ended on June 30, surpassing initial estimates for a more moderate decrease.

The barrel of the American reference for the sweet light crude oil plummeted to fresh 4-day lows in the mid-$44.00s on Wednesday in response to news citing Russia will not push for further/deeper output cuts, bringing a positive 9-session streak to a halt.

The rally in crude oil prices has also seen extra support after driller Baker Hughes reported last Friday the first decrease of oil rig count since mid-January, taking US active oil rigs to 756 (from 758 in previous week). This, plus a tick lower in US oil production last week fuelled further the rally, although concerns over the supply glut stay everything but abated as well as the uncertainty regarding the ability of the OPEC deal to balance the markets.

WTI levels to consider

At the moment the barrel of WTI is gaining 1.71% at $45.89 facing the immediate hurdle at $47.31 (high Jul.4) seconded by $48.20 (61.8% Fibo of the May-June decline) and then $48.97 (100-day sma). On the other hand, a break below $45.85 (38.2% Fibo of the May-June decline) would aim for $44.89 (21-day sma) and finally $44.40 (23.6% Fibo of the May-June decline).