WTI slips away from $ 64 mark, as rising US supply weigh

• Turns lower as USD recovers ground.           
• Rising US output levels dent sentiment.
• Eyes on US API crude stockpiles data.

WTI (oil futures on NYMEX) is looking to extend the retreat from three-week tops of $ 64.22, as the sentiment soured following the comments from the International Energy Agency (IEA) Chief Birol, delivered earlier today.

Birol said that the US will overtake Russia as the world’s biggest oil producer by 2019 at the latest, re-ignited concerns over the rising US production levels, especially in the wake of the Shale boom.

Rising US supplies would step up oversupply concerns, negating the effect of the OPEC output cut deal extension and the recent optimistic comments from the Saud Oil Minister Al Falih.

Despite the renewed weakness, the unexpected drawdown in the US EIA crude stockpiles last week combined with the Libyan El Feel oilfield force-majeure news kept the tone somewhat buoyant.

Meanwhile, subdued US dollar against its main peers ahead of the new Fed Chair Powell’s testimony also helps keep the prices supported. Focus now remains on the American Petroleum Institute (API) weekly crude stockpiles data due on the cards later on Tuesday,

WTI Technical Levels

At $ 63.72, the resistances are aligned at $64 (round number) and $64.22 (3-week tops) and $64.50 (psychological levels). On the downside, the supports are located at $63.50 (5-DMA), $63 (50-DMA) and $62.69 (10-DMA).