September 03, 2024 at 03:36PM
It’s a rough one for oil today with WTI crude oil down $3.03 to $70.52. That’s the lowest since January 17 and perilously close to the $60s.
The latest leg of selling came after a report on Friday that said OPEC+ is likely to proceed with a planned gradual production increase from October. The weekend China PMI at 49.1 compared to 49.5 expected is also weighing.
Today, there has also been a report that a deal was imminent to resolve a dispute that has halted Libyan production and exports. There is also a deep round of risk aversion ongoing with the Nasdaq down nearly 2% and most global commodities suffering.
Seasonally, September/October is a poor time of year for oil and it’s certainly started out that way. The fresh low on the crude chart also adds a technical drag with support now at $70.00 and the December 2023 low of $67.71.
I wouldn’t be surprised to see another OPEC leak saying that they will consider pausing adding barrels. But at the same time, OPEC might prefer some pain at this time of year as oil companies set 2025 budgets.
This article was written by Adam Button at www.forexlive.com.
