WTI dropps below the $52 handle on hints of gains in production

WTI has been pressured below the $52 handle in a continuation of the losses from $53.80 last week - next big level to the downside is $49.80.

A 10th straight weekly rise in the number of active U.S. oil rigs hinted at further gains in crude production and that has tipped the action in favour of the bears at the start of this week. Houston-based oil-field services company Baker Hughes Inc. reported last week that the number of active rigs drilling for oil in the U.S. rose by four in the same week which means that the U.S. has now got the highest number of rigs in operation since December 2015 - 529 in total.

The OPEC and non-OPEC producing countries recently came to an agreement to curb global production and trim output to 32.5 million barrels a day, but until the market witnesses production levels falling, the bulls may find a tough time getting over the psychological $55.00 mark - we have already seen Russia reported to have cut production by 100,000 bbls a day and the same has been heard from Middle Eastern nations such as Qatar, Kuwait and Oman.