Crude Remains Sleepless In Singapore Ahead Of OPEC

Crude oil’s quiet session today suggests the street is in wait and see mode for tomorrow’s OPEC meeting. 

Oil has settled into wait and see mode overnight with both contracts finishing ever so slightly low from the previous day. Brent closed down 50  cents at 63.10 and WTI fell a minuscule 10 cents to 57.57, shrugging off a higher than anticipated climb in crude stocks from the American Petroleum Institute’s inventory data.

Brent suffered some intra-day wobbles ahead of tomorrow’s crucial OPEC/Non-OPEC official meeting in Vienna. Although the market has priced an extension of the production cut until the end of March 2018, rumours continue to circulate that Russia may not be entirely on board or may request a review in June. Either outcome is likely to provoke some heavy selling of crude if cracks appear driven by the world’s largest producer.

Brent crude was sleepless in Singapore this morning, almost unchanged at 63.20. Initial support is nearby at 62.90 followed by 62.00 and then the all-import multiday low at 61.25. Brent quietly dropped through its short-term trend line on Monday, and this now intersects with the double top today at 64.45. Above there is the second double top at 64.85.

Brent Daily

WTI was also unchanged with support at 57.25 and then 56.75, its two-month trendline support. A break of this level opens up a potentially ugly drop to a series of daily lows at 55.00. Resistance is at 58.00 and then the November high at 57.90.

WTI Crude

With so much complacency about a rollover priced into tomorrow’s meeting, the balance of probabilities suggests that oil is more vulnerable at the moment to any disappointments from the OPEC summit.

This article 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 Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Jeffrey Halley

Jeffrey Halley

Senior Currency Analyst
Based in Singapore, Jeffrey has over 25 years experience in the financial markets, having traded currencies, options, precious metals and futures. Jeffrey started his career at Barclays Bank in New Zealand. However he has spent most of it in London and Asia.Jeffrey focuses on the Asia time zone across asset classes. A regular commentator on business news TV and Radio, he is originally from New Zealand and holds an MBA from Cass Business School, London.