WTI: Bulls losing strength above $ 66 mark, eyes on API data

• Trump-Kim Summit sends WTI back above 66 handle.
• Surging global oil output keeps a lid on the upside.
• US API data to offer fresh trading opportunities to oil traders.

WTI (oil futures on NYMEX) stalled its overnight upmove just ahead of the $ 66.50 barrier, as the bulls look to test the bear’s commitment at 66.00 levels, in light of Trump’s comments at the post-Summit press conference held in Singapore.

The US President Trump and North Korea’s leader Kim Jong-Un reaffirmed unwavering commitment to complete denuclearization, but the comment that the US sanctions on North Korea will remain in effect had a negative effect on the market sentiment that sent the high-yielding oil prices lower.  

The upside also remains capped, as surging production levels in the US, Russia and Kazakhstan undermine the OPEC’s efforts to curb supplies in order to rebalance the oil markets.

Russian production has reportedly climbed from below 11 million barrels per day (bpd) to 11.1 million bpd in early June. In the US, output has risen by almost a third in the last two years, to a record of 10.8 million bpd. Kazakhstan’s oil output in the first five months of 2018 rose 6.4 percent from the same time a year ago, according to Reuters.

Earlier today, the barrel of WTI extended its rebound from Monday’s drop to $ 64.86, as the US – North Korea Summit turned out be positive, as widely expected. Focus now shifts towards the US weekly crude supplies due to be published by the American Petroleum Institute (API) later on Tuesday for fresh momentum on the prices.

WTI Technical levels

Andria Pichidi, Market Analyst at HotForex, noted: “A closing today above $65.78, could imply that bulls are trying to gain the control of the instrument. The next immediate support to be retested is the $64.83, while on the break of this level the next support comes at last week’s $64.22 low.” – The asset indeed manage to be lifted yesterday back above $66.0, zeroing in on last week’s high at $66.24.  The $64.83 level turned to be a strong long-term support level for the US Oil, along with the new immediate support level at the 50% Fib. retracement at $65.50.”