WTI extends rally to fresh multi-month highs above mid-$66s
- US decides to end Iran oil sanctions waivers.
- Saudi Arabia gives the message that it could adjust its output in response to U.S. action.
- Coming up: API's weekly crude oil stock report.
Crude oil prices gained traction on Tuesday after the U.S. announced that it would not reissue waivers for Iranian oil imports and the barrel of West Texas Intermediate rose above the $66 mark for the first time since late October of 2018.
However, the WTI retraced its daily rally and turned flat on the day near $65.75 after reports of Saudi Arabia looking to ramp up its output with an aim to keep the oil market balanced following the U.S. action. Citing an OPEC source, Reuters reported that Gulf oil producers were committed to keeping the market stable and had the capacity to raise production. "But any decision to boost output has to be a measured one depending on demand, the sources said."
Although the market reaction to these headlines dragged the WTI back to its daily opening level of $65.65 ahead of the NA session, the WTI, once again, turned north and renewed its multi-month peak at $66.58 with American traders starting to price falling crude oil supply.
Later in the session, the API will publish its crude oil stock report for the week ending April 19.
Technical levels to consider