WTI Oil Attempting To Bounce Up From $93.40 Lows

WTI futures pick up to $98.00 from three-week lows at $93.40. Oil prices plunge on easing supply concerns and COVID-19 cases in China. From a wider perspective, US oil futures remain biased lower.

The US benchmark crude oil futures are attempting a mild correction on Tuesday’s US trading session. Front-month West Texas Intermediate contracts have appreciated about $4 over the last two hours, returning to levels past $98.00 after hitting three-week lows at 93.45 earlier today.

Oil prices have plunged nearly 30% from early-March highs above $129.00. Market concerns about a global supply shortage on the back of sanctions on Russian oil seem to have eased on hopes that Saudi Arabia and the United Arab Emirates are ready to increase production.

Furthermore, the exponential increment of coronavirus infections in China, which has already imposed lockdowns in some cities, has triggered concerns about a decline in demand from the Asian giant which is contributing to cool prices.

A look at the 4-hour chart shows oil futures trapped within a clear negative trend from early March highs. WTI futures are testing support right above the 50-day SMA, around $92.00, with the next potential targets on the downside, at $89.80 (February 25 low) and $86.40 (Jan. 28 and 31 lows)

On the upside, the pair is struggling to extend past $98.20. Above here, the next targets might be at $99.30 (intra-day high) and the $100.00 level.