Oil remains weak, WTI trading lower into $67.50

• Crude cautious as production looks set to remain on the high side.
• US oil continues to pour out of the ground, eroding the US' strength in demanding other countries engage in production cuts.

US oil prices took a step lower on Monday, knocked back by rising Saudi Arabia production that threatens to more than offset market constraints expected on the back of US sanctions on Iran.

WTI crude oil wound up closing down for the fifth straight trading day yesterday as US crude production looks set to begin increasing again, with special focus on Oklahoma's Cushing facility, where stockpiles rose by a surprising 900,000 barrels last week.

Energies traders are also watching to see if Saudi Arabia and Russia will be piling into any gaps left in global oil markets by Iran as several countries begin to bend to US President Trump's will, whose sanctions on Iran carry with them a threat against any third party countries who buy Iranian oil. The most notable country is South Korea, who is fully complying with US oil sanctions, and markets are concerned that Saudi Arabia and Russia will be scooping up the extra demand, a move that cuts the legs out from underneath a potential bullish push.

WTI levels to watch

With WTI trading into 67.60 after failing to hold yesterday's high of 68.50, with the last sing high of 71.35 producing additional resistance, while support hangs weakly from mid-August's swing low of 64.40, with support nearby at last week's low of 66.85.