WTI slips below $49 despite Scottish refinery gas leak

Following a recent strong upsurge amid the heightened expectations of an output cut deal extension, crude oil prices came under a heavy selling pressure at the NA session opening despite the news suggesting that a petrochemical plant at Grangemouth, one of Scotland's largest oil refineries, reported a gas leak, which is causing a major incident. The barrel of West Texas Intermediate is now trading at $48.79, down 0.1% on the day. 

Earlier in the day, a report by Reuters suggested that the OPEC compliance with its production-cutting deal fell to 90% in April from 92% in March. However, despite the lower compliance level, OPEC's total output contracted for the fourth month in a row. In addition, Mohamed Faraj Al Mazrouei, Oil Minister of the UAE, suggested that it would be appropriate to extend the deal.

• Logical to extend oil cuts – UAE’s Oil Minister

After rising to a daily high at $49.30, the barrel of WTI quickly erased its daily gains. There were no clear catalysts present that may have potentially triggered that move. In fact, the incident at Grangemouth refinery could be assessed as a possible supply disruption, which should have supported the upsurge in crude oil prices.

• Gas leak at huge Scottish oil refinery - The Independent

Technical outlook

The immediate resistance for the barrel of WTI is located at $49.30 (dialy high)) ahead of $49.75 (Apr. 28 high) and $50.20 (Apr. 26 high). To the downside, supports could be seen at $48.20 (Apr. 27 low), $47.80 (Mar. 28 low) and $47 (Mar. 22 low/psychological level).