Oil turns sharply lower, drops back below $45.00 ahead of EIA report

WTI crude oil failed to build on to its early tepid recovery gains and turned sharply lower, breaking back below $45.00 mark to currently trade at a fresh session low around $44.55 region. 

Earlier on Wednesday, the black gold witnessed a technical bounce after falling 3% on Tuesday after the Paris-based International Energy Agency reported a global slowdown in oil demand growth during the third quarter of 2016. Adding to this, API report that showed an increase of 1.4 million barrels in crude oil supplies exerted further selling pressure around the commodity. Moreover, a broad based USD strength was also seen weighing on dollar-denominated commodities, including oil. 

Oil traders now turn their focus to the official data on US crude stockpiles, scheduled later during NY trading session. The official EIA report is expected to show crude inventory rising by 3.8 million barrels during the week ended September 9 following a drop of 14.513 million barrels in the previous week. 

Technical levels to watch

A follow through selling pressure below $44.70 immediate support is likely to drag the commodity back towards $44.10-44.00 support area before extending its slide further towards its next major support near $43.50-45 region. On the flip side, $45.15-25 region now seems to have emerged as immediate resistance above which the commodity is likely to move past $45.50 intermediate resistance and head towards reclaiming $46.00 handle.