WTI stays pressured near $71.00 as Oil supply crunch woes battle with fears of easing energy demand – Crypto News – Crypto News
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WTI stays pressured near $71.00 as Oil supply crunch woes battle with fears of easing energy demand – Crypto News

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  • WTI fades bounce off intraday low, defends previous day’s U-turn from one-week high.
  • Fears about tropical storm Bret turning into hurricane outside US Gulf renews supply crunch woes.
  • PBoC rate cut, concerns about China’s economic recovery and the Sin-American tussle prod demand out.
  • Risk catalysts eyed amid full markets’ return, light calendar.

WTI crude oil price retreats towards the intraday low of around $71.00 as downbeat sentiment joins demand woes amid early Tuesday in Europe. In doing so, the black gold also pays little heed to the supply crunch emanating from tropical storm Bret.

Late on Monday, the US National Hurricane Center flagged concerns that tropical storm Bret is likely to strengthen and could turn itself into a hurricane on Thursday and Friday. It’s worth noting that tropical storm Bret is heading toward the US Gulf and may land just outside the oil-rich area, which in turn raises supply-crunch fears.

It should be noted that the OPEC+ supply cuts and comments from Saudi Arabia suggesting more tightening in the output also defend the Oil buyers.

On the other hand, fears of China’s economic slowdown gain momentum after the People’s Bank of China (PBoC) cuts its benchmark Loan Prime Rates (LPRs) by 10 basis points (bps), matching market expectations. On the previous day, multiple top-tier banks, including Goldman Sachs and JP Morgan, downwardly revised China growth forecasts and raised fears of easing energy demand, considering China’s status as one of the world’s biggest energy consumers.

Elsewhere, hawkish concerns about the US Federal Reserve (Fed) and the European Central Bank (ECB) also weigh on the WTI demand. Outlook and prod the energy benchmark’s price of late.

Against this backdrop, S&P500 futures print mild losses whereas the US 10-year and two-year Treasury bond yields grind near 3.82% and 4.75% respectively by the press time, after rising in the last two consecutive days. That said, the US Dollar Index (DXY) struggles to defend recent gains near 102.50.

Moving on, concerns about the major central banks and risk catalysts will be key to watching for clear directions.

technical analysis

Steady RSI (14) and bullish MACD signals join a one-week-old rising support line, near $70.35 at the latest, to restrict short-term WTI crude oil downside.

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