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WTI extends gains on falling US rig count, OPEC

FXStreet (Mumbai) - WTI oil kicked-off the week on a stronger footing, although retreated from multi-month highs, as markets continue to digest the latest US rig count report and also the comments from OPEC’s Secretary-general delivered over the weekend.

WTI retraces below $ 50

Currently, WTI rallies 0.92% to 49.90, moving away from fresh multi-month highs reached at 50.92 on Friday. Oil prices keep pushing higher on expectations of falling production levels, boosted by another rig count fall in the US while a broadly weaker US dollar continues to underpin.

Oil services company Baker Hughes reported on Friday a decline in the active US oil rig count for the fifth straight week, dropping by nine, bringing the total count to 605, the lowest since June 2010.

On Sunday, OPEC Secretary General El-Badri said, “At OPEC, we are hopeful that the industry will see a more balanced oil market in 2016. We have recently seen a contraction in production from some non-OPEC producers and an uptick in demand growth." This also lent a helping hand to the oil price rally.

Looking ahead, the black gold will be influenced by the Chinese data, including the country’s trade data, while a batch of US data will also play a key role in the oil price-action.

WTI Oil Technical Levels

WTI oil has an immediate resistance which stands at 50.92 (Oct 9 High) levels above which gains could be extended to 51.26 levels. Meanwhile, support is seen 49.49 (Today’s Low) levels from here losses could be extended to 47.76 (Oct 8 Low).

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