- OPEC+ to discuss output hikes for October
- API crude oil stockpiles rose 0.6 million barrels
- WTI oil faced rejection at the 50 SMA, rebounding lower towards 63.00
prices are extending their decline amid rising expectations that OPEC+ will increase its output at a time of growing concern over higher supply.
With OPEC+ aiming to increase market share, it could start unwinding 1.65 million barrels per day of output cuts, around 1.6% of global demand. The oil cartel has already agreed to increase output by roughly 2.2 million barrels per day between April and September. This comes alongside an additional 300,000 barrels per day increase from the UAE. The prospect of more supply is pressuring prices.
US crude inventory data is adding to the bearish tone as API data showed crude inventories rose by 622,000 barrels. The unexpected build points to weaker demand and slower refinery activity, reinforcing downside momentum.
Attention will turn to U.S. data with , the , and figures. All right, Peter, provide fresh cues on the Federal Reserve’s policy outlook for September.
The data comes after weak figures yesterday and ahead of the key report on Friday.
Signs of a slowing U.S. economy combined with increased supply may keep oil on a downward trajectory.
Oil Forecast – Technical Analysis
Oil trades within a descending channel dating back to 2023. The price trades below its 200 SMA in a bearish trend. Oil failed to rise above the 50 SMA and the 65.00 round number, rebounding lower, with the RSI below 50 highlighting bearish pressure. Should sellers extend the bearish move below 61.45, the August low, and 60.00 round number, this creates a lower low and could spur a deeper selloff towards 55.00.