WTI bounces after hitting 10-month lows and remains negative beneath $80.00

• Albeit plunging below $76.00, WTI stages a comeback, trimming earlier losses to 0.51%
• Saudi officials denied news that OPEC considered increasing oil production.
• WTI Price Analysis: A candlestick hammer in the daily chart can propel oil prices higher.

Western Texas Intermediate (WTI) remains negative during the North American session after hitting a daily low of $75.30 per barrel on rumors that the Organization of the Petroleum Exporting Countries (OPEC) was considering an increase in its oil production, as reported by the Wall Street Journal (WSJ). Another factor that weighed on crude oil demand was China’s Covid-19 outbreak, causing three deaths in the last week, augmenting speculations that China’s oil need will diminish. Therefore, WTI exchanges hand at $79.88 per barrel.

According to OPEC delegates cited by the WSJ, Saudi Arabia considered boosting crude oil output by 500,000 barrels ahead of the oil embargo imposed on Russian oil. Once the headline crossed wires, WTI slashed 3.6% of its value, collapsing towards its daily low of $75.30, before recovering some ground as the Saudi Energy Minister Prince Abdulaziz bin Salman, denying those affirmations

Prince Abdulaziz bin Salman said, “if there is a need to take further measures by reducing production to balance supply and demand, we always remain ready to intervene.”

Aside from this, China’s Covid-19 cases are increasing to levels last seen in April 2022, according to Goldman Sachs. Sentiment shifted sour on fears that Chinese authorities reimposing lockdowns could slow down the global economy, weighing, and denting crude oil’s demand.

Oil traders should be aware that OPEC and its allies (OPEC+)will meet on December 4 to lay the ground for January 2023, one day before the Russian oil embargo and G7 oil price cap begins.

Also read:

• Saudi Arabia eyes OPEC+ production increase – WSJ
• Saudi Energy Minister Abdulaziz: The current OPEC+ deal continues to the end of 2023

WTI Price Analysis: Technical outlook

WTI daily chart suggests that oil prices fell short of the 2022 YTD low of around $74.30 PB and are staging a comeback, nearly $80.00 PB. Notably, Monday’s price action formed a massive hammer candlestick, suggesting that WTI could rally in the near term, but firstly, buyers need to reclaim $80.00.

If that scenario plays out, WTI’s first resistance would be October’s 18 swing low-turned-resistance at $82.10, followed by the 50-day Exponential Moving Average (EMA) at $85.72 and the 100-day EMA at $89.51. On the flip side, WTI’s key support levels are the September 26 daily low at $76.28, the November 21 swing low at $75.30, and the YTD low of $74.30.