Crude oil price trades sharply lower today cancelling the positive momentum that formed after the rebound from the recent lows at $49.25. Black gold managed to rebound the previous week but this week as the coronavirus spreads around the world is under heavy selling pressure. The sell-off accelerated after the CDC warned that U.S. should prepare for the virus.
The API reported yesterday that crude inventories rose by 1.3 million barrels in the week to February 21, to 4.2 million barrels, below the expectations for a build of 2 million barrels.
Saudi Arabia supports further oil production cut amid the weak demand due to coronavirus crisis, but Russia has not announced its decision yet. The OPEC+ group, said that it would respond responsibly to the spread of the coronavirus and the implications on global trade.
The WTI crude oil price is 1.32% lower at $49.25 as the price continues lower for the fourth consecutive session . The crude oil price is now at 13-month lows, and the technical outlook is clearly bearish.
On the downside, first support for crude oil price stands at $48.99 today’s low. More bids might emerge at $48.30 the low from January 8th,2019. A move below that level, would result in a deeper move down to $46.71 the low from January 4th, 2019
On the flip side, WTI crude oil price initial resistance stands at $50.42 the daily high. If the crude price breaches the initial resistance, the next obstacle will be met at $51.97 the high from yesterday’s trading session. In case of a bullish breakout, next hurdle will be met at 52.62 the high from February 24th.