WTI crude oil broke below several key support areas, signaling that a longer-term slide is underway. Price sealed its break below the long-term daily channel support and is moving below a descending trend line on short-term charts.

However, the 100 SMA is still above the longer-term 200 SMA on the daily time frame so there’s a chance that buyers could regain energy. Then again, the gap between the moving averages is narrowing to show a potential downward crossover, drawing more sellers to the mix.

Stochastic is already indicating oversold conditions, which could encourage profit-taking among sellers. RSI is also dipping into oversold territory to signal weakening bearish pressure. If both oscillators start turning higher, a quick pullback from the drop could take place. Potential resistance is located at the broken channel support and falling trend line around $48 per barrel.

WTI crude oil shrugged off the larger than expected draw of 2.5 million barrels in stockpiles according to the Energy Information Administration’s update. This was more than twice as much as the projected reduction of 1.2 million barrels and the earlier drop of 1.7 million barrels.

Still, market watchers are worried about another strong increase in US production as rig counts have been on the rise in the past week. Also, Libya continues to ramp up its output after closing its Wintershall deal, staying on track to pump 1 million barrels per day by next month.

Earlier in the day, Iran’s oil minister said that the cartel is mulling deeper production cuts but other delegates downplayed the likelihood of this happening. Indications that the output deal and extension aren’t doing enough to shore up the commodity’s price have led investors to doubt the effectiveness of OPEC decisions.

Further crude oil price declines could be in the cards unless there are reports of significant reductions in output or inventories in the weeks ahead. Remarks from OPEC officials could also influence oil price action, although gains could be limited until actual action is taken.