Oil futures made a sharp turn lower Tuesday, giving up their highest levels in about 18 months to mark their lowest settlement in about two weeks, with traders anxious to find out whether OPEC and other major oil producers will stick to their pledge to cut back output. February West Texas Intermediate fell by $1.39, or 2.6%, to settle at $52.33 a barrel on the New York Mercantile Exchange, the lowest finish since Dec. 20, according to data from Dow Jones. It had traded as high as $55.24, which would have marked the highest settlement level since July 2015.
Prices saw a sharp reversal from an early rally and at least part of the reason for the move was technical, Tyler Richey, co-editor of The 7:00’s Report, told MarketWatch. “There was a roughly $1 ‘gap’ between Friday’s primary session close and this morning’s 9 a.m. open and fast money traders chased it lower to ‘fill the gap,’” he said.