Oil prices turned bearish losing over 5% intraday. The declines came on the back of fundamentals.
OPEC’s crude oil production in September increased by over 160,000 bpd, leading to a decline in oil prices.
As a result, crude oil has breached the support area near 38.83. A sustained close below this level could extend declines to the early September lows near 36.50.
On the other hand, to the upside, the gains could be limited as the resistance level near 41.00 holds for the moment.
With the bearish engulfing pattern forming on the daily chart, we could expect the declines to continue.