WTI off highs, back below $54.00

After hitting fresh peaks in levels last seen in July 2015 in the mid-$54.00s, the barrel of West Texas Intermediate has now receded to the $53.80 region, still up by more than 4%.

WTI boosted by non-OPEC deal

The recent upside momentum in crude oil prices has been boosted further following the deal between 11 non-OPEC producers to reduce the output by nearly 560K bpd.

The deal adds to the previous agreement clinched between OPEC countries on November 30, by which producers will cut the output by 1.2 mbpd to 32.5 mbpd starting in January, all in order to stabilize the oil market and spur prices from previous depressed levels.

Later in the week, the usual reports on inventories by the API (Tuesday) and the EIA (Wednesday) are due, although the focus of attention will remain on the buck and the FOMC meeting on Wednesday, with consensus expecting the Fed to hike the Fed Funds rates by 25 bp.

On the positioning front, WTI speculative net longs have climbed to the highest level since October 25 during the week ended on December 6 and according to the latest CFTC report.

WTI levels to consider

At the moment the barrel of WTI is gaining 4.21% at $53.67 and a breakout of $54.50 (2016 high Dec.12) would aim for 62.58 (high May 6 2015). On the other hand, the immediate support lines up at $52.59 (low Dec.12) followed by $51.66 (high Dec.9) and finally $49.61 (low Dec.8).