WTI extends recovery above $51 on OPEC deal extension expectations

Following three straight days of losses, crude oil prices gained traction on Thursday with the barrel of West Texas Intermediate reaching a fresh daily peak at $51.08 in the last hour. As of writing, the barrel of WTI was trading at $51, adding 2% on the day.

Although WTI slumped below the critical $50 mark on Wednesday after Sharara field in Libya, which pumped 234,000 barrels on October 1st before it stopped production, re-opened, it was able to stage a meaningful recovery on Thursday. 

Following Russian President Vladimir Putin's claim that the supply cut agreement could extend to the end of the year after it expires in March 2018, "in the kingdom, we have to keep all options open, President Putin agreed with us on this and expressed his readiness to extend until the end of 2018 if this is agreed, and if this is the best option,” Saudi Energy Minister Khalid al-Falih said in an interview with Al Arabiya television. Commenting on today's market action, “bullish comments from the Russian and Saudi Energy ministers are helping arrest the recent decline in oil prices,” Stephen Brennock, an analyst at London brokerage PVM Oil Associates, told Reuters.

• Saudi OilMin: ‘We are going to be committed to oil production curbs’

Technical outlook

The initial hurdle for the barrel of WTI aligns at $51.70 (Oct. 2 high) followed by $52.86 (Sep. 29 high) and $53.75 (Apr. 12 high). On the downside, supports could be seen at $50 (psychological level), $49.30 (Sep. 19 low) and $48.50 (Sep. 6 low).

• Oil: Price volatility continues – BBH