Crude oil price on the West Texas Intermediate (WTI blend) has fallen by nearly 3% as the risk aversion triggered by US-China tensions over Hong Kong appear to have spooked investors once more. Threats of US sanctions over China, the world’s largest consumer of crude oil, has triggered a turn in crude oil prices which had been on a 6-week upside roll.
The crude oil price on the spot market are currently down 2.28%, after having dropped by as much as 5% earlier in the session to just above $32 a barrel. It now trades at $33.38, while the crude oil price on the WTI July futures asset fell 4%.
Comments attributed to the CEO of Exxon Mobil, Darren Woods are also having a dampening effect on prices. Woods says his company could see a demand drop of 10% in 2020.
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Technical Outlook for WTI
WTI crude oil price is trading between the 34.68 resistance and the 33.15 price support, where lows of May 21 and 26 reside. The break from the bullish pennant appears to have stalled at the present price levels, as crude oil price on the WTI has failed to break the 34.68 price level. This price needs to give way for the WTI to make the run towards the 42.15 resistance. 49.60 seems to be too far out a possibility at this time, but it remains relevant and could come into the picture if crude oil price breaches 42.15.
On the flip side, today’s slide appears to have been limited by the 33.15 price level. A breakdown of this price level could usher in further decline towards the support at 29.16 as the initial target, with 24.94 and 19.78 coming in closely behind. Further risk aversion is need to spur this selloff.