Will WTI Oil see a sustained break above $54/barrel?

WTI oil daily chart shows spikes above $54.00 since mid-December have repeatedly run into offers.

Prices did close above $54.00 on Tuesday, but fell back below the psychological level on Wednesday. At the time of writing, oil was flirting with $54.00 handle.

The American Petroleum Institute (API) data released overnight showed a surprise drawdown of 884K in the US oil inventories as opposed to the expected build of 3.3 million barrels. Oil could see sharp gains above $54 handle if the official government data due for release today confirms the drawdown in the US inventories.

The markets have already priced-in good news from OPEC. Hence, sustained gains above $54 handle would require positive news flow out of the US.