WTI keeps the upbeat tone near $54.00 ahead of API, Biden

Prices of the WTI edge higher and target $54.00.
Attention is on probable announcements by Biden later on Wednesday.
The API will publish its usual weekly report on US crude oil supplies.

Pablo Piovano FXStreet

Prices of the West Texas Intermediate (WTI) move closer to the key $54.00 mark per barrel on Wednesday.

WTI stays firm, looks to Biden, API

The barrel of WTI adds to Tuesday’s gains and trades well above the $53.00 mark on Wednesday, although a test of the $54.00 level still remains elusive for oil bulls.

Moving forward, traders will closely follow the developments from the inauguration of Joe Biden as the 46^th US President later on Wednesday, with potential announcements regarding the oil industry in the centre of the debate.

On another front, and in its monthly report, the IEA forecast an increase of around 5.5 mbpd in the demand for oil crude in 2021 (to around 96.6 mbpd). The agency also projects an increase of around 1 mbpd in oil production.

In the docket, the API will release its weekly report on US crude oil inventories ahead of the EIA’s report on Thursday.

What to look for around WTI

Prices of the American reference for the sweet light crude oil manage to keep business around levels last seen in February 2020 near $54.00. Past news regarding Saudi Arabia (unilateral oil output cut), the decision of the OPEC+ to refrain from increasing oil production and further US fiscal stimulus already anticipated by traders also collaborate with the upbeat mood surrounding the commodity. However, the relentless increase of coronavirus cases across the globe amidst the vaccine rollout coupled with fresh lockdown measures mainly in China and Europe keeps traders somewhat worried and recovery prospects tempered.

WTI significant levels

At the moment the barrel of WTI is up 1.45% at $53.76 and faces the next hurdle at $53.90 (2021 high Jan.13) seconded by $54.45 (monthly high Feb.20) and finally $59.61 (high Jan.20 2020). On the downside, a breach of $47.20 (monthly low Jan.4) would expose $46.18 (low Dec.23) ahead of $43.94 (monthly low Dec.2).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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