September WTI (West Texas Intermediate) crude oil futures contracts rose for the second day. Prices have been fluctuating within a downtrend channel since the last week of June 2015. The falling crude oil inventories and appreciating US dollar could swing crude oil prices.
The pessimistic sentiments of oversupply could drag crude oil prices lower. The next support for WTI prices is seen at $44 per barrel. Crude oil prices hit this mark in March 2015. In contrast, long-term lower crude oil prices might boost crude oil prices. The next resistance for WTI prices is seen at $55 per barrel. Crude oil prices hit this level in July 2015.
The crude oil price chart suggests that WTI crude oil prices could fluctuate between $46 and $50 per barrel in the near term. US crude oil prices could hit $45 per barrel in October 2015, according to estimates from Goldman Sachs. Mike Tran, a commodities specialist at RBC Capital Markets, expects that US crude oil prices could average around $50 for the rest of 2015.
Lower crude oil prices benefit ETFs like the ProShares UltraShort Bloomberg Crude Oil (SCO). In contrast, ETFs like the VelocityShares 3X Long Crude ETN (UWTI) benefit from rising crude oil prices.
Energy producers like Apache (APA), EOG Resources (EOG), and Noble Energy (NBL) are also impacted by the uncertainty in crude oil prices. Combined, they account for 8.81% of the Energy Select Sector SPDR ETF (XLE). These stocks’ crude oil production mix is more than 41% of their total production.