Earlier today, WTI crude oil price rose to its two-week highs at 27.05. This was sparked by US President Donald Trump’s tweet saying that Saudi Arabia and Russia are close to a deal on production cuts. However, the commodity has been struggling to hold on to its gains in the past hour as issues surface.
According to US President Donald Trump, he had spoken to the crown prince of Saudi Arabia. He was supposedly told that the country, along with Russia, is looking to cut oil production by 10-15 million barrels per day. This news was bullish for crude oil price at the onset because the two countries have been in an oil price war since the beginning of March.
However, investors quickly realized that the amount would be equal to half of what Saudi Arabia and Russia produce. The two countries produce roughly 12 and 11 million barrels per day, respectively. This then raised eyebrows on how likely the cuts would push through. It also did not help that Russia announced that it had not been in talks with Saudi Arabia.
Lastly, Saudi Arabia then called on other oil-producing countries like Mexico and Canada to cut oil production. This came off as a desperate move for Saudi Arabia, only fueling speculations that Trump’s tweet may not have been true.
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WTI Crude Oil Price Outlook
On the 4-hour time frame, it can be seen that WTI crude oil price CFDs is testing resistance at the 100 SMA.
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If sellers are able to dominate trading, we could see WTI crude oil price fall to the area between 21.10 and 22.45. These prices coincide with the rising trend line (from connecting the lows of March 30 and April 1) and the 61.8% Fib level (when you draw from yesterday’s low to today’s high) on the 1-hour chart.Alternatively, if there are enough buyers around the current level at 24.90, WTI crude oil price may begin its upwards rally. It could trade up to 40.65 which coincides with the falling trend line from connecting the highs of January 8 and February 20. Should this happen, the gap on WTI crude oil price on March 9 will have effectively been filled.More content
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