WTI up, up and away with DXY down and OPEC efforts

WTI has rallied today with the DXY lower by -0.13%, remaining below the 96.29 July highs. However, fueling the rally comes with fundamentals in the speculation by traders that there will be production cuts from Libya and Nigeria.

The expectations for second-consecutive declines in U.S. crude supplies also underpins the upside for traders. OPEC is under pressure and the possibility of bringing Libya and Nigeria into the picture, previously exempt from production cuts, makes a bullish case for the black gold. Both are members of OPEC but had been exempt from OPEC production cut accord to cut global output by 2%. Markets await the next OPEC’s meeting on July 24 held in Moscow that should bring some clarity to the matter. 

However, the bearish case for oil remains overwhelming, especially due to U.S. shale drilling that has been gaining momentum and was raising concerns among traders that the 2018 market could well be drowning in oil. The American Petroleum Institute’s weekly U.S. petroleum supplies data will be released later today while the International Energy Agency will come later in the week. 

WTI broke above the psychological $45.00 level and earlier resistance and now loses momentum at $45.30 and 6th July gap guarding $45.76. To the downside, $44.38, $44.10, $45.75, $42.94 and $41.84 on the wide ar the supports.