Crude Oil retreated from the morning high. As signs of ample supply and rising U.S. crude inventories. Countered hopes for higher demand arising from a jump in manufacturing in top crude importer China.
U.S. oil inventories rose by 6.2 million barrels in the week ended Feb. 24. according to market sources citing American Petroleum Institute (API) data. Ahead of official Energy Information Administration stocks figures at 9 pm today.
In other signs of ample supply, Russia’s oil production reached the pre-sanctions level for the first time in February. The Kommersant business daily reported citing sources, and OPEC production rose in February according to a Reuters survey.
Resilient Russian supply is keeping buying interest at bay, he added.
Oil was up earlier in the session. Supported by an official index that showed China manufacturing activity expanded at fastest pace in more than a decade in February. Adding to hopes that the country’s recovery can offset a global slowdown and increase oil demand.
While China’s official manufacturing purchasing managers’ index (PMI) climbed to 52.6 last month against 50.1 in January. A private sector survey also showed activity rising for the first time in seven months.
Technical View
Crude oil prices retreated from the morning high of 6431 and are currently trading at 6315. On the above daily chart, Crude price was unable to cross 50% Fibonacci Retracement of its previous swing.
Further, prices also faced resistance of 50 SMA on the chart which is indicating pressure on rise.
Today, 6255 will act as an immediate support and a break below may witness correction. Crude oil prices could test next support 6190-6150 if it breaks below 6255.
On the upside, massive resistance is seen at 6480 and a break above it could open the door for pullback. And prices may test next resistance 6522-6585.
Further, Crude oil inventory is due to be released at 9pm today. U.S. oil inventories rose by 6.2 million barrels in the week ended Feb. 24, according to market sources citing American Petroleum Institute (API) data, ahead of official Energy Information Administration stocks figures.
A higher than previous week inventory appears to put pressure on Crude oil prices.