WTI Crude Oil Cuts OPEC+ Inspired Gains To Near $91.50 Amid US Dollar Strengthening

  • WTI holds Friday’s pullback from the six-week high and has been drooling around the intraday low lately.
  • US criticism of OPEC+ decision joins pessimistic data from China, hawkish bets from the Fed to probe oil bulls.
  • Escalating geopolitical tensions and challenges from global central bank rate hikes favor the bulls.
  • IMF, World Bank meetings could entertain oil traders, US inflation, Fed minutes will be crucial in justifying latest pullback.

WTI Crude Oil holds near $91.50 as risk aversion joins hawkish Fed bets to propel the US Dollar. However, holidays in the US, Canada and Japan are limiting the oil’s immediate moves in Monday’s Asian session.

Along with the extended weekend in major markets, downbeat PMI data from China and criticism of the latest move by the Organization of the Petroleum Exporting Countries and its allies, including Russia, known collectively as the OPEC+, are also probing oil buyers.

US Treasury Secretary Janet Yellen has said, according to the Financial Times (FT), that OPEC+’s decision to cut oil production was “unnecessary and reckless” for the global economy, especially emerging markets already struggling with high energy prices.

Over the weekend, China’s Caixin Services PMI for September fell to 49.3 from 55.0 previously. With that, the private activity gauge marked the first contraction since May.

Additionally, Friday’s strong US jobs report boosted the odds of a 75 basis point (bp) rate hike from the Fed, which in turn weighed on prices. petrol. The latest US jobs report for September showed Nonfarm Payrolls (NFP) stock rose to 265K from the expected 250K. The unexpected drop in the unemployment rate to 3.5% from forecasts suggesting no change from the previous 3.7% also illustrates the strength of employment conditions in the United States.

Despite everything, the recent explosion on the Crimean bridge and the European sanctions on Russian oil exports keep hope among commodity buyers.

Then this week’s annual meetings of the World Bank (WB) and International Monetary Fund (IMF) in Washington will be crucial as world financial leaders discuss geopolitical tensions and inflationary pressure, as well as central bank moves. . Wednesday’s Federal Open Market Committee (FOMC) minutes and the US Consumer Price Index (CPI) will also be important.

It should be noted that WTI Crude Oil prices are near major near-term resistances amid fears of supply shortages and therefore any positive news could easily propel the quotation.

Technical analysis

The 100-day EMA and a three-month resistance line around $92.20 and $92.70, respectively, are challenging WTI crude buyers. That said, the retreating RSI hints at a near-term pullback towards the $90.00 level revision.

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