Oil settles higher as US inventories report offset OPEC

Oil futures settled higher on Thursday, as a drawdown in US crude inventories offset lack of agreement to cap output at an OPEC meeting in Vienna.

West Texas Intermediate for July delivery settled at $49.17 a barrel on the New York Mercantile Exchange, up 0.3%, recovering from an earlier drop below the $48 level.

EIA reported drawdown of 1.4 million barrels in US crude stockpiles during the last week. The report also noted that US crude production continued to tick down, favoring further the price recovery.

WTI technical perspective

“Now trading a few cents below the $49.00 level, the daily chart shows that the price once again bounced after testing a bullish 20 SMA, indicating buyers are still active on dips. Technical indicators in the mentioned time frame have retreated from overbought levels, and lack directional strength at the time being,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, a modest bearish tone prevails, as the price remains capped by a bearish 20 SMA, whilst the technical indicators have turned slightly lower below their mid-lines, but lacking directional momentum.”

Support levels: 48.60.48.10 47.40. Resistance levels: 49.20 49.70 50.25.