FxWirePro: US Oil prices spike higher on surprise OPEC+ output cut

Chart - Courtesy Trading View 

Oil prices reversed the steep losses seen through March and surged higher in early Asian trade on Monday. 

West Texas Intermediate crude rose over 5% to $81.51 a barrel before paring some gains and was trading close to levels seen in late-January at the time of writing.

The surprise move by the Organization of Petroleum Exporting Countries and allies, (OPEC+) was the main reason behind the surge. 

OPEC+ said on Sunday that it will cut production by about 1.16 million barrels per day (bpd), ducking prior expectations that the cartel will maintain output.

OPEC+ unexpectedly cut production further to stabilize markets hit by fears of slowing economic growth and a potential banking crisis.

Oil prices had crashed to 15-month lows in March after the collapse of several U.S. banks stoked concerns over slowing economic growth and weakening crude demand.

Major Support Levels: 

S1: 78.37 (110-EMA)

S2: 75.30 (55-EMA)

Major Resistance Levels: 

R1: 82.63 (55-week EMA)

R2: 84.10 (200-DMA)

Summary: US oil poised to extend gains, trades with a bullish bias. Scope for test of 200-DMA at 84.10.