WTI Crude Oil at $74.50 Amid Fed Rate Cut Expectations and OPEC+ Decisions

WTI Crude Oil extended its gains on Thursday, driven by expectations that the Federal Reserve will cut interest rates in September. According to a Reuters poll conducted from May 31 to June 5, nearly two-thirds of economists predict a rate cut, despite the bearish supply news.

Lower interest rates typically decrease borrowing costs, potentially boosting economic activity and oil demand.

OPEC+ Supply Decisions Influence Market Sentiment

Despite these gains, WTI Crude Oil prices remain capped due to higher U.S. inventories and OPEC+’s decision to increase supply. The Organization of the Petroleum Exporting Countries and its allies agreed on June 2 to extend most of their output cuts into 2025.

However, they allowed for voluntary cuts from eight members to be gradually unwound starting in October. This move is expected to add pressure to benchmark prices in the final quarter of 2024.

Bearish Sentiment from U.S. Crude Stock Data

Additionally, U.S. crude stocks rose by 1.2 million barrels in the week ending May 31, contrary to analysts’ expectations of a 2.3 million barrel draw, as reported by the U.S. Energy Information Administration.

Saudi Arabia’s recent cut in official selling prices for July crude also reflects falling Middle East crude benchmarks and weaker profit margins for Asian refiners.

WTI Crude Oil Price Forecast: June 6, 2024

WTI Crude Oil is currently trading at $74.52, showing a slight increase of 0.06%. The chart timeframe is set to 4-hour intervals, providing a detailed view of recent price movements. Key price levels to watch include the pivot point at $74.46, which acts as a crucial support and resistance marker.

Immediate resistance is identified at $75.66, followed by $76.56 and $77.54. These levels will be important to monitor for potential upward movements. On the support side, the immediate level to watch is $72.59, with further support at $71.26 and $70.07.

These levels will help gauge the strength of any downward trends. Technical indicators show the Relative Strength Index (RSI) at 45.40, suggesting neutral momentum with a slight upward trend. The 50-day Exponential Moving Average (EMA) is at $75.99, indicating a modest bullish bias.

In conclusion, WTI Crude Oil’s current price action near the pivot point at $74.46 reflects a neutral stance.

A break above $75.66 could signal further gains, while trading below $74.46 may trigger selling pressure. The outlook remains balanced, with key levels acting as critical markers for potential trend shifts.

ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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