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EIA Report Fuels Crude Oil Sell-Off, OPEC Outlook in Focus

West Texas Intermediate (WTI) crude oil prices briefly pushed above $79.00 on Wednesday before retreating on news of another substantial US inventory build reported by the Energy Information Administration (EIA). The EIA’s data adds to the inventory increase reported by the American Petroleum Institute (API) on Tuesday, further pressuring prices.

The EIA reported a 4.199 million barrel increase in US crude stocks for the week ending February 23, exceeding forecasts and adding to the previous week’s buildup. The API report also signaled rising inventories. In response, the Organization of the Petroleum Exporting Countries (OPEC) has extended first-quarter production limits into June and is considering extending cuts through the second quarter. The cartel aims to support prices by limiting supply, particularly in light of increased production and exports by non-OPEC nations like the US, which recently became the largest crude oil exporter to Europe.

WTI’s brief rally, which saw prices reach their highest level since late November, stalled at $79.27 before retracting. The 200-day Simple Moving Average (SMA) near $77.67 remains a significant resistance level. Despite a 9% increase from February’s swing low, WTI struggles to maintain bullish momentum.