WTI fluctuates sharply post-EIA report, remains below $60

• EIA reports a larger-than-expected draw in U.S. crude stocks.
• WTI remains in consolidation channel below $60.

Following the weekly crude oil report released by the Energy Information Administration, the barrel of West Texas Intermediate spiked up to $59.72 before coming back to $59.55, where it closed the previous day.

The EIA announced that commercial crude oil inventories in the United States decreased by 4.6 million barrels on a weekly basis for the week ending December 22. This reading surpassed the market expectation of a 4 million barrels decline. 

Following the robust rally witnessed earlier this week, the barrel of WTI seems to be staying in a consolidation phase ahead of the New Year weekend. Moreover, a Reuters report earlier didn't allow a deep correction in crude oil prices. Citing a source with direct knowledge of the matter, Reuters reported that China had issued crude oil import quotas totaling 121.32 million tonnes for 44 companies in 2018. "China's imports are expected to hit another record in 2018 as new capacity is brought online and Beijing allows more independent refiners to import crude, with robust demand growth helping to support global oil prices," the article read.

Technical levels to consider

Only with a decisive break above critical the $60 handle, the barrel of WTI could extend its gains toward $60.65 (Jun. 1, 2015, high) and $61.10 (May 5, 2015, high). On the downside, supports are located at $59.30 (Dec. 27 low), $58.30 (Dec. 26 low) and $57.60 (Dec. 21 low).