Oil break previous lows on API and eyes 4hr 200 smoothed sma

WTI is losing ground from 52.80 support and has made a fresh low for this week at 52.45, surpassing the previous low at 52.47 on the back of the US API inventory data.

This was the private oil inventory data ahead of the  Energy Information Administration and official data. Nevertheless, there was a surprise stockpile of crude inventory which weighs on the price of oil and petroleum products. Crude arrived as a build of 11600k in the week to March 3 vs previous 2500k, compared with analysts' expectations for an increase of 2000k barrels.

API reports 11.6 million barrel US crude stockpile increase

WTI crude futures had settled before the data at 53.14 and Brent at 55.92. Oil has been buoyed by the production cuts that had been agreed between OPEC and non-OPEC producers. The agreement expires in June but the OPEC Secretay General Barkindo said that any decision to forward with an extension of cuts would have to include non-OPEC producers and as such it could be extended. more meetings will follow in May to discuss extending these cuts. Moreover, there are mounting concerns that US production could offset efforts by the Organization of the Petroleum Exporting Countries. The EIA will release weekly data on U.S. oil supplies tomorrow and analysts polled by S&P Global Platts forecast an increase of 1.6 million barrels in crude stockpiles for the week ended March 3. 

WTI levels

With a break below the 52.80 support and 4hr 20 sma at 52.73, the focus is now on a breach of the 52 handle to test the rising 200 4hr smoothed sma at 51.90 where demand after the 53.60 drop and early Feb highs came in at 50.86. A break there will jeopardise the rising channel from Nov lows of 42.10. to the upside, the daily 20 sma at 53.10 guards the 28th Feb highs of 54.03.