WTI bounces-back above $ 57 ahead of EIA inventory data

• China Oct oil imports fall sharply.
• USD recovers losses.
• Hopes of OPEC cuts deal extension underpin.
• US EIA inventory reports on tap.

WTI (oil futures on NYMEX) remains offered so far this Wednesday, as the sentiment remains weighed down by weakening Chinese crude oil demand and also on the back of increased nervousness ahead of the EIA crude supplies data due later today.

WTI: $ 57.69 still on sight?

The black gold stalls its retreat from 2-1/2 year tops, now making minor recovery attempts just ahead of $ 57 mark, as Saudi’s latest anti-corruption crackdown combined with renewed geopolitical tensions propping up between the key OPEC members, Saudi Arabia and Iran, continue to lend some support to the oil bulls.

Also, the commodity also remains supported amid a broadly subdued US dollar, in response to the US tax reforms uncertainty. A stronger US dollar makes the USD-denominated oil expensive for the buyers in foreign currencies.

However, further upside appears capped due to a sharp fall in the Chinese crude oil imports in October, which implies softening demand from the world’s top oil consumer. China Oct crude oil imports drop to lowest in more than a year – RTRS

Attention now turns towards the official US Govt crude stockpiles data due later in the day, especially after yesterday’s bullish API report, which showed yet another draw in the US crude inventory for the last. At the time of writing, WTI drops -0.22% to $ 57.07, while Brent steadies at $63.73.

WTI Technical Levels

Higher-side levels: 57.69 (multi-month highs), $ 58 (round number), $ 58.37 (classic R3)

Lower-side levels: 56.55 (5-DMA), 56.00 (key support), 55.42 (10-DMA)