U.S. West Texas Intermediate bullish foundations support collapsed as supply increased overnight, with the U.S. benchmark falling more than -24% at one point and now revisits the lows posted back in 2002 after hitting an intraday mark at $20.45 a barrel, while Brent crude ended to a loss of -13.2% at the close.
At present, oil prices are heading to a historic loss for the year, with WTI and Brent roughly down by -60%.
The severity to the fall was driven from the massive production hikes planned by both Saudi Arabia and Russia in a fight for a share of a market and not agreeing to the Saudi Arabia requests of tightening supply.
Meanwhile, earlier on Wednesday, the U.S. Energy Information Administration reported that crude stockpiles in the country rose for an eighth-straight week, growing by nearly 2 million barrels last week although by less than the 3.2 million barrels expected by analysts.
Due to the overnight’s decline, support has now widened to $16.00-$19.00 with the immediate resistance seen from $23.70-90 to $24.80-95.