WTI weaker, rangebound above $56.00, API eyed

• WTI extending the sideline theme below $57.00.
• Pick up in US production weighs on sentiment.
• API’s weekly report due later in the NA session.

Prices of the barrel of the American benchmark for the sweet light crude oil are extending its bearish note during the first half of the week below the key up barrier at the $57.00 mark.

WTI attention to API

Prices for the WTI are down for the third day in a row on Tuesday, although they manage well to keep the trade above the critical $56.00 mark for the time being.

Traders remain optimistic regarding the likelihood of an extension of the OPEC production cut agreement beyond March 2018, although some concerns over the pick up in the US production seem to have poured cold water over the recent rally beyond the $57.00 handle.

These concerns have found further sustain after the OPEC revised up its forecasts for US shale supply, which is now seen around 7.5 mbpd in 2021 (up from 5.1 mbpd in the previous report).

Adding to the weak note around WTI, driller Baker Hughes reported on Friday that US oil rig count went up by 9 during last week to 738 US active oil rigs.

Ahead in the session, the API will publish its weekly report on US crude oil supplies, ahead of Wednesday’s official DoE’s report on inventories.

WTI significant levels

At the moment the barrel of WTI is down 0.55% at $56.45 and a breach of $56.30 (low Nov.13) would aim for $56.29 (10-day sma) and then $55.83 (23.6% Fibo of $45.58-$57.69). On the upside, the immediate resistance aligns at $57.91 (2017 high Nov.8) seconded by $62.58 (2015 high May 6) and finally $77.83 (high Nov.21 2014).