Crude Oil Prices Dive on Global Supply Glut
$OIL, $USO, $BHI
World Crude Oil prices suffered big losses Monday, with the WTI Crude Oil marking below 40 bbl for the 1st time since April, as a survey showed that output in the Organization of the Petroleum Exporting Countries (OPEC) reached record highs last month.
Production in July by the OPEC likely rose to its highest mark in recent history, as Iraq pumped more and Nigeria squeezed out additional Crude Oil exports despite militant attacks on production installations.
Meanwhile, the number of rigs operating in US fields added by 44 in July, the most in a month since April 2014, data from Oil services company Baker Hughes (NYSE:BHI) showed.
Demand for Crude is also set to fall in the next few months. US refineries usually reduce operating rates to perform seasonal maintenance as the Summer driving season comes to an end.
The West Texas Intermediate (WTI) for September delivery dropped 1.54 to settle at 40.06 bbl on the New York Merc (NYMEX), while Brent Crude for October delivery dove 1.39 to close at 42.14 bbl on the London ICE (ICE) Futures Exchange.
At this writing, Monday, 1 August, 9:30p EDT Crude Oil futures are trading at:
USD/bbl. 40.12+0.06+0.15%Sep 20169:30p
With further Southside follow-through on the tentative breakdown below 40 and the 200-Day MA, the next major Southside targets are at the Key 38 and 34 support marks.