WTI drops as US refineries shutdown on Harvey havoc

Oil futures on NYMEX failed to resist the upside above $ 48 mark yet again, and now extends its retreat into Europe, as sentiment remains dampened by the Harvey hurricane.

The black gold drops further to test 50-DMA support located at $ 47.51, as demand concerns get stoked up on expectations that the US refineries shutdown, in the wake of on the back of Hurricane Harvey, could curb the demand for the American crude.

However, the losses may remain capped amid the recent drawdown pattern seen in the US crude supplies, while broad based US dollar weakness on the back of Yellen’s silence on the monetary policy could also offer some respite to the bulls.

Looking ahead, the US weekly crude supplies report due tomorrow and Wednesday will be eagerly awaited for the next direction in oil. At the time of writing, WTI trades -0.71% lower at $ 47.53, while Brent turns negative to trade below $ 52 mark.

WTI technical levels 

Higher side: $ 47.84/48 (10-DMA/ round number), $ 48.74/89 (Aug 21 & 18 high), $ 49.49 (200-DMA).

Lower side: $ 47.21 (100-DMA), $ 46.46 (3-week lows), $ 46 (key support)