West Texas Intermediate (WTI), the benchmark for New York-traded crude oil prices, fell on Thursday, extending losses as investors braced for increased supplies after a compromise deal between leading OPEC producers and the likely impact of the COVID Delta variant in the coming months.
A rebound in the US Dollar also pressured crude prices.
(WTI) slid more than -2% after news sources reported that Saudi Arabia and the United Arab Emirates appeared to be closing in on an agreement on August production.
But the deal still needs to be ratified by the enlarged 23-nation OPEC+ alliance that groups the 13-member Saudi-led Organization of the Petroleum Exporting Countries with 10 assorted producers led by Russia.
Looking ahead, attention now turns to the closely watch Baker Hughes oil rig count update.
As the decline heading into the second consecutive day suggests, bearish eyes look to the $69.50-$70.20 level as the technical assessment leads further into negative territory.
The Moving Average Convergence Divergence (MACD) supports a negative signal, while the Relative Strength Index (RSI) 3-daily ‘lookback’ indicator has married up to the MACD as its crashes through the 50-midway point.
Reassess from the $69.50-$70.20 (if reached), with $73.15-35, seen as a short term cap.