WTI: Bulls offered reprieve amid profit-taking after over 30% plunge

• WTI still remains nearly 18% down intraday, despite the recovery.
• Saudi price war and opening up of the taps fuel the oil price crash.
• Focus on US crude supply reports, coronavirus updates and risk trends.

WTI (oil futures on NYMEX) is seen trying hard to extend the recovery beyond the $ 34 mark but the slump in the US equities, Wall Street futures and Treasury yields continue to remain a drag on the prices.

Markets received a double blow after Saudi Arabia launched a price war over the weekend that knocked-off oil to its cheapest in four years at $27.34, sharply down over 30% and on its way to register the biggest daily loss since 1991. The price war was mainly to avenge Russia’s refusal to agree on the output cuts proposed by the OPEC+ last Friday.

This added to the already omnipresent pessimism over the coronavirus outbreak, with the fears heightened after the number of new cases exploded across Europe and the US. The oil traders also weigh in the bearish IEA monthly report, which showed the first contraction in demand since 2009.

So far this NA trading, the oil-price recovery remains intact, as investors take profits off the table after the 30+% crash while markets believe that Saudi’s selling price cut could likely revive the demand prospects for oil and its products, lately hit by the virus spread induced global economic uncertainty.

At the press time, WTI trades at 34.08, still losing 17.75% on a daily basis.

WTI Technical levels to consider