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WTI crude prices gave up earlier gains on Monday as rising U.S. output loomed over markets, despite a slowdown in rig drilling activity.
U.S. West Texas Intermediate (WTI) crude futures were at $61.90 a barrel at 0714 GMT, down 14 cents, or 0.2 percent. Brent crude futures were at $65.36 per barrel, down 13 cents, or 0.2 percent, from their previous close.
“A falling rig count and the strong employment data may have helped support prices,” said William O’Loughlin, investment analyst at Rivkin Securities.
In oil markets, U.S. energy companies last week cut oil rigs for the first time in almost two months, with drillers cutting back four rigs, to 796, Baker Hughes energy services firm said on Friday.
Despite the lower rig count, which is an early indicator of future output, activity remains much higher than a year ago when, when just 617 rigs were active, and most analysts expect U.S. crude oil production, which has already risen by over a fifth since mid-2016, to 10.37 million barrels per day (bpd), to rise further.
The Organization of the Petroleum Exporting Countries (OPEC), together with a group of other producers led by Russia, has been withholding production since the start of 2017 to prop up prices.
It is not clear when the deal to withhold output will end, but Iranian oil minister Bijan Zanganeh said OPEC could agree in June to begin easing current oil production curbs in 2019, the Wall Street Journal reported on Sunday.
On the technical charts, WTI crude is trading in the negative zone but above all the moving averages (9 day, 20 day, 50 day, 100 day, and 200 day). The RSI is at 49.37 and MACD is below the signal line.
Sell stop at 61.85, Take profit at 61.50, Stop loss at 62.1