Crude oil has been pushing higher over the last few days, led by some key fundamentals and also a weak USD.

WTI took out the $60 mark yesterday, a point that has been providing a fair bit of resistance of recent times. The falling USD on the back of Jerome Powell’s testimony to Congress certainly helped start the ball rolling but there were some other factors in play as well.

Weekly Inventory Draw

The Weekly EIA inventories came in with yet another draw, the fourth straight week of excess demand impacting the supply levels. The nearly 10million barrel figure was larger than many expected and has added to the short-term issues. These have been well-telegraphed but it appears there is more demand around than many had thought.

Iran Worries

There have been reports that Iranian ships have been impeding UK vessels in the Strait of Hormuz. Iran has been a bit of a factor in oil prices recently and given some of the comments from the leaders recently, more sanctions will likely be on the way.

Hurricanes

There is some talk of hurricanes headed to the Gulf of Mexico which forces rigs to shutdown. This is obviously a short-term issue but again is contributing to the kick higher in price.

Technical Outlook

We are at or around the $60 level at the moment and I feel like there is still selling pressure here. Besides each of the dollar increments, the $64 and then $66 levels are the major resistance levels.

It would take a fair bit of work to pass these points as over the longer-term, there is plenty of supply coming on board in the latter half of 2019. OPEC has acknowledged as much and tried to keep supply low.

With that in mind, pops higher into key resistance could be a chance to look for a short-term top.