• WTI crude futures gained over 1% to approach $80.5 a barrel, while Brent crude futures increased almost 1% to reach $83.9 a barrel on Thursday.
• Saudi Arabia and Russia both announced extensions of their oil production cuts, with Saudi Arabia maintaining its 1 million barrels per day cut into September, and Russia reducing its oil supply by 300,000 barrels per day in September.
• US crude inventories fell by a record 17 million barrels last week, but concerns about subdued demand recovery in China and Europe continue to weigh on the market.

The WTI Crude oil Futures closed with a double distribution volume profile structure in yesterday’s session, and the market seems poised to fill the low volume area between the distributions, indicating a potential establishment of a balanced behavior.

The news on production cuts managed to break the lower technical distribution, which previously acted as resistance, leading to an auction into the LVN area. However, the prior VWAP close level might serve as a selling level, potentially combined with absorption and long liquidations in the final hours of the New York trading session.

The lower dollar could exert pressure on the WTI version, especially since the US has become a net exporter of oil. Additionally, the positive volatility for the session might act as technical resistance in the current upward rotation, driven by the fundamental news aspect. The long-term volatility indicates a bullish market bias for oil prices, while the median term shows mixed signals, leading to a potential rotational behavior.

The slightly bullish nuance from the dollar in the median-term perspective might be a factor to consider, while the majority viewpoint could be perceived as bearish for the market.

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