Crude oil prices give up 0.39% at $56.01 per barrel after EIA weekly report noted a 1.699 mb drop in USA crude oil stocks missing forecasts of an increase of 2.8 mn bbl. The drop in inventories came from steady production, rise in refinery usage, higher exports and lower imports. US crude production was steady at record level of 12.6 mb per day. Adding further support to crude were reports indicating that OPEC+ producers might consider production cuts in their next meeting in December. IMF lowered its full-year growth forecasts for the Asian region to 5% from 5.4% projection made in April. The global economic growth rate expected to 3% down from 3.2% in a July forecast.
Oil traders focus on crude fundamentals and ignore the new point of geopolitical tensions in the East. Many analysts expect crude oil to remain under pressure in the short term due to weak global demand on the back of recession fears, US-China trade tensions and a stronger USD.
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WTI Crude Oil Technical Analysis
Crude oil managed to break above the three-week trading range between $52 and $55 as the momentum turns bullish for crude oil prices, trading above the 50 and 100-day moving averages. On the upside, crude oil immediate resistance level stands at the daily high at $56.17, while more offers could emerge at $57.08 the 200-day moving average. Next barrier is the $58.50 mark the high from September 24th.
On the downside, immediate support stands at daily low at $55.85, then at $55.39 the 50-day moving average followed by October 23 lows at $53.71. Long positions can sit comfortably as long as the crude price trades above the 100-day moving average.