WTI Oil hits one-week low on US gasoline build and excess supply concerns

• Oil under pressure as US gasoline build overshadows oil inventory drop.
• OPEC revised up its estimate for non-OPEC supply growth in 2018.

WTI oil is fast losing altitude, now trading at a one-week low of $56.52 as the decline in the US crude stockpiles was offset by a larger-than-forecast rise in gasoline inventories.

The US government data released earlier today showed the US oil inventories last week dropped 5.1 million barrels. However, as per Reuters report, the gasoline stocks jumped 5.7 million barrels, more than double analysts’ expectations for a 2.5 million-barrel gain.

Further, the production hit another new record high at 9.78 million barrels per day (bpd). The rising shale output prompted the OPEC to revise up its forecast of non-OPEC supply growth in 2018.

Clearly,  the tables seem to have turned in favor of the bears. Even the post-Fed decline in the American dollar has failed to boost oil prices. Hence, prices look set to test the ascending 50-day MA of $55.92.

WTI Technical Levels

A move below $55.92 (50-day MA) would expose support at $54.98 (Nov. 14 low). On the higher side, breach of the immediate hurdle at $56.86 (previous day's low) would shift risk in favor of re-test of the session high of $57.78.