US Crude Stockpiles Drop Bolsters WTI Crude Prices

WTI crude futures climbed above $79 per barrel on Thursday, continuing their upward trajectory from the previous session, fueled by a more substantial than anticipated decrease in weekly US crude inventories, which supported oil prices. According to EIA data, US crude stockpiles dropped by 2.508 million barrels last week, marking the second consecutive weekly decline and surpassing expectations for a draw of 1.362 million barrels. Unexpected declines were also observed in US gasoline and distillate fuel inventories. Additionally, soft US inflation data for April strengthened speculations of interest rate cuts by the Federal Reserve in September, thereby enhancing the demand outlook. Meanwhile, the International Energy Agency revised  its global demand growth projection for this year by 140,000 barrels per day to 1.1 million. Elsewhere, the latest OPEC report revealed that member countries exceeded their production cap by 568,000 barrels per day in April. However, solid demand projections of 2.25 million barrels per day in 2024 and 1.85 million barrels per day in 2025 were upheld.

Despite experiencing a sharp decline yesterday, oil quickly rebounded, signaling a shift towards a positive outlook. To maintain this positivity, the first support level to watch is at 78.30. Breaking below this region could trigger declines towards 77.60, with further support found at 76.90. Additionally, as the positive outlook persists, the initial resistance level to encounter upward movement is at 79.40. If this level is surpassed with sustainability, the next target to monitor is at 80.10. Lastly, the third level to monitor is at 81.00.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
81.00	80.10	79.40	78.30	77.60	76.90