Oil falls back below $50/bbl as US stock data disappoints

Crude oil prices settled lower on Wednesday after EIA report showed US oil inventories fell less than expected last week.

West Texas Intermediate oil for August delivery settled at $49.13 a barrel on Nymex, down 72 cents, or 1.4% on the day.

The commodity retreated from a peak of $50.52/bbl struck during the Asian session, but has been steadily declining ever since, accelerating its slide after the EIA report showed that US stockpiles decreased by less-than-expected in the week ended June 17th. Down by 900,000 barrels, the market was expecting a 1.67 million draw-down, resulting in US crude falling down to an intraday low of 48.39, from where it later bounced.

Oil technical perspective

“Daily basis, the black gold continues in consolidative mode, as the price keeps hovering around a horizontal 20 SMA, whilst the technical indicators have turned modestly lower within neutral territory,” said Valeria Bednarik, chief analyst at FXStreet. “Shorter term, the 4 hours chart shows that the price is currently developing below its 20 SMA, whilst the technical indicators head lower below their mid-lines, pointing for some further slides ahead.”   

Support levels: 48.40 47.60 46.90. Resistance levels: 49.60 50.20 50.80.