WTI Crude – Will oil prices encourage Russia and Saudi Arabia to extend cuts?

• Growth concerns weigh on demand expectations
• OPEC+ meeting later this month eyed for further cuts
• WTI hits lowest level since July

Oil prices have been trending lower again in recent days after rebounding on Tuesday, around the October lows in the case of WTI.

There are clearly concerns around demand going into next year, particularly around China, which OPEC this week sought to relieve, to no avail.

The recent trend may make it difficult for Saudi Arabia and Russia to allow their unilateral cuts to expire at the end of the year, which is something markets may be gradually pricing in.

The lack of a commitment to extend so far may reflect a desire to not but as we’ve seen so often in the past, the producers will do whatever it takes to support the price. The question may be whether they can get others on board.

Four-month low in WTI

After running into resistance around $80, near the October lows, WTI has been trending lower once more and some interesting tests lie ahead

WTICOUSD Daily

Source – OANDA on Trading View

It has already fallen back to the next test of support around $74 where it appears to be stalling. That said, today’s sell-off has been quite strong so it will put that support level to the test.

Below here, $70 stands out as another possible support zone, although arguably $68 below here is more significant having provided strong support earlier in the summer.

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.