WTI tumbles to lows near $48.20

Crude oil prices are fading part of the recent advance and are dragging the barrel of West Texas Intermediate to the area of daily lows around $48.20.

WTI gains capped by 200-day sma

Prices for the WTI met increasing selling pressure on Thursday amidst some recovery in the greenback, while market participants continue to gauge yesterday’s lower-than-expected draw in crude supplies reported by the EIA.

It is worth recalling that US crude oil supplies decreased by 1.753 million barrels in the week ended on May 12, less than initially forecasted.

In the meantime, all the focus remains on the next OPEC meeting on May 25, where the cartel is likely to announce an extension of the ongoing output cut agreement between OPEC and non-OPEC countries into early 2018.

Prices for the black gold now seem to have consolidated in the upper bound of the recent range, up around 14% since YTD lows near $43.70 (May 5) although with gains so far capped around the 200-day sma in the $49.50/60 band.

WTI levels to consider

At the moment the barrel of WTI is losing 1.55% at $48.31 facing the next support at $48.13 (20-day sma) seconded by $47.58 (38.2% Fibo of the April-May drop) and then $47.35 (low May 12). On the upside, a break above $49.54 (200-day sma) would aim for $49.66 (high May 15) and finally $49.94 (61.8% Fibo of the April-May drop).