Oil Price Fundamental Daily Forecast – Low Volume Could Lead to Sideways Trade Ahead of OPEC Decision

U.S. West Texas Intermediate and international-benchmark Brent crude oil closed lower on Monday as cautious investors continued to pare positions ahead of next week’s OPEC meeting. The rising dollar may have also put a dent in demand for crude.

January WTI Crude Oil settled at $56.42, down $0.29 or -0.51% and February Brent crude oil closed at $62.06, down $0.49 or -0.78%.

In other news, Nebraska regulators approved a route for TransCanada Corp’s Keystone XL pipeline through the state on Monday, lifting the last big regulatory obstacle for the long-delayed project that U.S. President Donald Trump wants built.

Forecast

Crude oil prices are treading water early Tuesday as the impact from expectations of an extended OPEC-led production cut was cancelled out by rising output in the United States.

At 0700 GMT, January WTI Crude Oil is trading $56.46, down $0.03 or +0.05% and February Brent Crude Oil is at $62.12, up $0.06 or +0.10%.

Trading was light on Monday in a trend that should continue throughout the week due to Thursday’s U.S. bank holiday.

On the bullish side of the equation, hedge and commodity fund managers have built a huge long position on expectations an OPEC-led group will decide to extend its current program designed to cut output, trim global production and stabilize prices when it meets on November 30.

On the bearish side, traders are worried about increasing U.S. production and the possibility Russia will refrain from an extension to cut production.

Brent crude oil has resistance at $62.71 to $63.11 and support at $60.36 to $59.40.

WTI resistance is $56.57 to $56.94 and support is $54.62 to $53.78.

If volume remains light and the fundamentals balanced, we could see a sideways trade on Tuesday.