WTI/USD – US Crude Jumps as Russia Says Will Join OPEC Deal

US crude has posted strong gains on Monday, pushing above the $51 level. In the North American session, WTI/USD futures are trading at $51.35 per barrel. Brent futures have risen to $53.14, as the Brent premium stands at $1.79. There are no US releases on the schedule, as the markets are closed for Columbus Day.

Oil prices started the new week with sharp gains. US crude has climbed 4.0% on Monday, after Russian president Vladimir Putin stated that Russia would join the OPEC agreement to cap production levels. OPEC members surprised the markets in late September when they reached a tentative agreement to put a ceiling on production levels in order to stabilize oil prices. OPEC has called on other exporters to join the agreement, and having the backing of Russia will be an important step towards reaching a final agreement, slated for next month. At the same time, oil producers have not been able to bridge their differences in the past, so analysts remain skeptical that an agreement will be reached.

The US released eagerly-awaited employment numbers for September on Friday, and the data was mixed. Nonfarm payrolls, one of the most closely watched indicators, rose slightly to 156 thousand. Although this was well short of the forecast of 171 thousand, the markets do not appear overly concerned, as other employment indicators were steady. Average Hourly Wages edged up to 0.2%, matching the forecast. The unemployment edged up to 5.0%, just above the forecast of 4.9%. As well, the labor force participation rate ticked higher. Unemployment claims sparkled last week, dropping to just 249 thousand, beating the estimate of 255 thousand. Unemployment claims have come in below the forecast for 10 straight weeks, pointing to a tight labor market. Jobless filings have been below 300,000 for 83 straight weeks, marking the longest streak since 1970. Overall, September employment numbers were decent and the likelihood of  December rate has actually risen slightly since Friday, from 63 percent to 66 percent.

WTI/USD Fundamentals

Monday (October 10)

• There are no US releases on the schedule

WTI/USD for Monday, October 10, 2016

WTI/USD October 9 at 12:00 EDT

Open: 49.23 High: 51.60 Low: 49.20 Close: 51.35

WTI USD Technical

• WTI/USD was flat in the Asian session. The pair has posted strong gains in the European and North American sessions
• 50.13 is providing support
• There is resistance at 53.50

Further levels in both directions:

• Below: 50.13, 46.69, 43.45 and 38.38
• Above: 53.50, 59.69 and 65.49

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