Crude Oil extends declines, WTI aimed for $82 per barrel

• Crude Oil markets are extending downside moves, WTI tips below $83.00 on Tuesday.
• Despite the US PMI data beat, broad forecast misses for EU PMIs are souring the outlook on crude demand.
• Geopolitical tensions from the Middle East continue to wane, further pushing down barrel costs.

West Texas Intermediary (WTI) Crude Oil prices are seeing extended declines on Tuesday, continuing Monday's downside push and sending WTI barrels into a new low of $82.76, a fresh one-week low as energies markets rethink their expectations of EU-led fossils demand after a broad miss on Purchasing Manager Index (PMI) figures early Tuesday.

US Manufacturing PMI edges higher to 50 in October, Services PMI improves to 50.9

US PMIs came in well above expectations, sending the US Dollar (USD) higher on Tuesday and adding to downside Crude Oil pressure; the US Composite PMI for October printed a surprise uptick into a flat 51, compared to September's 50.2 printing. Markets were expecting a decline in both the Manufacturing and Services components of the PMI, but US PMIs came in green across the board and investors lurched back into the USD.

The Pan-European PMI, on the other hand, printed broadly in the red, missing Wall Street forecasts and flubbing the latest set of forward-looking growth indicators for the EU.

Eurozone Manufacturing PMI unexpectedly drops to 43.0 in October vs. 43.7 expected

The EU HCOB Manufacturing PMI for October came in at just 43, well below the forecast 43.7 and completely snubbing the expected increase, coming in even worse than September's print of 43.4. The Services component likewise missed forecasts, printing at 47.8 against the expected steady reading of 48.7. The combined PMI Composite headline missed the anticipated 47.4, coming in at 46.5 versus the previous month's 47.2.

The big miss for EU PMI figures, combined with a USD-boosting US PMI beat, is increasing USD-denominated barrel costs and crumbling investor expectations for rising EU-based Crude Oil demand moving forward.

WTI Technical Outlook

Tuesday's decline for WTI Crude Oil sees US barrel prices tapping a fresh one-week low at $82.76, and the current downside barrier for barrel sellers will be early October's price floor of $80.63, with the 200-day Simple Moving Average (SMA) sitting near $78.00.

WTI has tumbled nearly 7% from Friday's near-term high of $89.64, and Crude Oil bulls will need to recover back to late September's highs for the year near the $94.00 major handle.

WTI Daily Chart

WTI Technical Levels