WTI Oil Tries To Rebound After Sell-Off

Key Insights

• WTI is moving higher amid reports about OPEC+ plans to cut production. 
• Natural gas moves lower as Hurricane Ian may put pressure on demand. 
• Precious metals gain some ground as dollar pulls back from highs.

WTI Oil Found Support Near $76.50

WTI oil is up by about 2% as traders react to Russia’s plans to reduce OPEC+ production by 1 million bpd at the next meeting. The reports have not received official confirmation but traders believe that they are credible.

OPEC+ fails to meet its quotas due to production problems in certain member countries. Saudi Arabia, which has the technical ability to produce more oil, did not commit to raising production amid recession worries.

WTI oil is trying to gain some upside momentum after finding support near $76.50. It remains to be seen whether this attempt will be successful amid recession fears. RSI remains in the moderate territory, so there is plenty of room to gain downside momentum in case the right catalysts emerge.

Natural Gas Is Losing Ground As Hurricane Ian May Cut Demand

Natural gas is trading below the $7.00 level as traders prepare for Hurricane Ian, which will likely reduce demand.

In Europe, natural gas prices gained strong upside momentum after mysterious leaks in Nord Stream pipelines. At this point, it looks that these leaks were caused by explosions, and the pipelines will not work in winter even if EU and Russia reach a consensus deal on natural gas. Obviously, this is bullish for the European natural gas prices.

In the U.S., traders will stay focused on the domestic developments in the near term. Freeport LNG is expected to be partially operational by the end of November. Until then, the U.S. cannot increase its exports, which is a bearish factor for U.S. natural gas prices.

Precious Metals Attempt To Rebound

Precious metals are moving higher after yesterday’s sell-off. The U.S. dollar has pulled back from recent highs, providing some support to this market segment.

Gold managed to get above the $1630 level while silver moved towards $18.50. Platinum rebounded towards $850, and palladium climbed back to $2100.

It remains to be seen whether precious metals will be able to gain additional upside momentum as Treasury yields keep moving higher.

Copper Remains Stuck Near $3.30

Copper is trading near the $3.30 level as traders remain worried about the slowdown of the world economy.

Government bond yields are moving higher at a robust pace in most developed countries, which will put additional pressure on economic activity. This is a bearish development for copper markets.

For a look at all of today’s economic events, check out our economic calendar.