WTI Oil clocks 5-week high

WTI Oil rose to a five-week high of $53.21/barrel this Tuesday morning, underpinned by US-Syria tensions and shut down at Libya’s largest oil field. 

The futures were last seen trading around $53.15/barrel.

Supply outage

The production at Libya’s largest oil field Sharara came to a halt on Sunday after a group blocked a pipeline linking it to a oil terminal. This was icing on the cake as oil was already well bid heading into the weekend, courtesy of US air strike on Syria.

Record high US inventories

What’s interesting is the prices have rallied despite record high inventories at Cushing, Oklahoma and US Gulf Coast. The American Petroleum Institute (API) weekly inventory data will be released today. The near 90 degree rally in oil over the last few days suggests scope for technical correction if the API reports huge buildup in inventories.

WTI Oil Technical Levels

A break above immediate resistance at $53.77 (Mar 7 high) would expose hurdle at $54.00 (zero figure) and $54.31 (Feb 2 high). On the other hand, a breakdown of support at $52.91 (Apr 7 high) would open doors for $52.52 (Mar 2 low). A violation there would expose major support at $51.50 (50-DMA).