WTI sold-off aggressively below the key $50 level, weakest since October 2017

• Stops triggered below a break of the key 50 threshold, opening floors for a test of Oct 2017 lows.
• Markets unnerved ahead of next week’s OPEC meeting, expected OPEC output cuts.

Oil prices on both sides of the Atlantic reversed the Asian gains and fell sharply in the European trading this Thursday, with the US oil (WTI) tracking the losses in its European peer, Brent.

WTI came under aggressive selling pressure and hit the lowest levels since October 2017 at 49.46 on a break of the key psychological support at 50, as stop triggered below the last and paved the way for further declines. The next target for the bears is seen at 49.10 – October 2017 lows. Meanwhile, Brent slips below the 58.50 level, down -1.15%.

The sell-off in oil was mainly driven by the renewed concerns whether the OPEC+ will fail to deliver on the expected output cuts to stem the price declines and supply overhang when it meets next week in Vienna on December 6.

Also, increased cautiousness ahead of Friday’s Trump-Xi meeting on trade keeps the black gold on the defensive. Over the last hour, however, the black gold attempts a tepid bounce, helped by a positive tone on the European indices and sell-off in the Treasury yields, which usually makes the barrel of WTI attractive as an alternative higher-yielding asset.

The focus now remains on the FOMC minutes for fresh dollar trades that could have a significant impact on the USD-sensitive oil.

WTI Technical Levels