Crude Oil faces uphill battle with OPEC keeping traders in the dark

• Crude Oil trades near the year-to-date low recorded on Thursday below $70.00.
• Sketchy OPEC communication leaves traders in the dark for the next movements. 
• The US Dollar Index trades just below 101.00 ahead of the US Employment Report. 

Crude Oil consolidates this week's sharp decline to a fresh year-to-date low below $70.00 for a second day in a row on Friday. Crude Oil prices remain subdued mostly because of the sketchy communication from the Organization of the Petroleum Exporting Countries and its allies (OPEC+). Although several delegates from the consortium might have said that a deal is near to delaying production normalization, markets would have thought that OPEC would come up with far more thorough and impactful measures that would support Crude Oil prices more substantially. 

The US Dollar Index (DXY), which tracks the performance of the US Dollar (USD) against a basket of currencies, is falling just below 101.00 ahead of the US Employment Report for August. With market expectations stretched to a near 100 basis points cut in the Federal Reserve (Fed) interest rate by November (it looks like markets have priced in a bit too much easing from the Fed), the US Nonfarm Payrolls report on Friday might signal a steady soft landing, which would suggest smaller increments of 25 basis points per Fed meeting. This could see the US Dollar jump higher as yields would soar.

At the time of writing, Crude Oil (WTI) trades at $69.04 and Brent Crude at $72.92

Oil news and market movers: OPEC only acts when it is cornered

• Several traders are reporting to Bloomberg that they are taking recent communication from OPEC+ with a pinch of salt, as OPEC only now reacts when Crude Oil prices are falling below their price floor and starts to feel the pain financially. 
• The Options market sees options being skewed to more bearish territory, with Brent 25-delta puts deepening recent moves, Bloomberg reports. 
• Reuters reports that the recent decline in Crude Oil prices should steady for now, with the recent chunky US drawdowns matching the concern for oversupply after the Energy Information Administration (EIA) saw a chunky 6.873 million drawdown in Crude stockpile against last week's 0.846 million drawdown, and snapping above the projected 0.9 million drawdown expected. 

Oil Technical Analysis: OPEC reliance under fire

Crude Oil's price action could dip a little further as the OPEC+ headlines are often obsolete by the end of the trading day. It paints a very clear picture that markets are only hanging some importance on OPEC communication for a short period of time. Clearly, OPEC is not being considered a reliable communicator, which means they will need to step up their game and act more firmly and swiftly if they want to have that price floor in place. 

On the upside, the $75.27 will be the first level to head back to. Next, the $77.43 level aligns with both a descending trendline and the 200-day Simple Moving Average (SMA). In case bulls can break above it, the 100-day SMA at $78.00 could trigger a rejection.  

The low from August 5 at $71.17 has been broken. From here, the $68.00 big figure is the first level to watch, followed by $67.11, which is the lowest point from the triple bottom seen back in June 2023. 

US WTI Crude Oil: Daily Chart