Oil consolidates OPEC deal-led 9% rally

Oil prices on both sides of the Atlantic gave up all of its gains seen in the Asian session, and now consolidates two-month tops, as dust settles after the OPEC deal induced extensive upsurge.

WTI recedes below $ 50 mark

Currently, both crude benchmarks trade range-bound to lower, with Brent below $ 52 mark while WTI trades just ahead of $ 49 levels. Oil prices built onto yesterday’s solid rally in the Asian session this Thursday, before meeting fresh supply in Europe as the bulls take a breather after the relentless rise, assessing the implications of the OPEC deal and its conditional agreement with the non-OPEC producers.

OPEC clinched an historic oil put cut deal on Wednesday, with Saudi Arabia agreeing on a bigger output cut against a cut from Iraq, while dropped a demand that arch-rival Iran also slash output. While OPEC made an agreement with the non-OPEC producers also, asking them to cut 600k bpd.

Looking ahead, what remains to be seen whether OPEC’s arrangement made with the non-OPEC producers materializes, which will have a huge bearing on the oil markets. Also, it’s worth noting that the OPEC deal sent trading volumes to record highs.

Brent oil technical levels

Omkar Godbole, Analyst at FXStreet, noted, “Brent was last seen trading around 51.50/barrel. A break above $52.00 (zero figure) could yield a re-test of the previous day’s high of $52.33. On the lower side, breach of support at $50.72 (Aug 26 low) would expose the psychological support of $50.00.”