2019-11-11 • Updated
Traders said prices were being supported by strong demand, and also political uncertainty following the U.S. missile air strikes on Syria late last week. Oil-producing Iran and Russia condemned the US military actions and renewed their support to stand by Syrian President Bashar al-Assad. If we observe a further escalation of the conflict, the oil prices will probably hit fresh highs.
Brent crude oil futures rose almost to $55.90 on Monday building on their Friday’s gains sparked after the launch of US missiles on Syrian airbase. Geopolitics will probably remain the main factor supporting the rally in oil prices in short-term as the US Navy is heading to the Korean Peninsula to prevent North Korea from resorting to new missile tests.
Additional tailwind for the oil prices was the news that Libya’s Sharara field halted, and the National Oil Corp. declared force majeure on exports. Before the following disruption, Sharara being exempted from the obligations under oil production cut deal had been pumping 200 thousand barrels a day.
The major headwind for the oil futures – revival of the drilling activity in the US. Baker Hughes reported an additional increase in a number of US rigs (it has been rising for 12-straight weeks).
Source: Investing.com
Higher US output can undermine OPEC’s efforts to reduce the oil glut by cutting their own production. But hopes are still intact, as oil producing countries are currently discussing an additional extension of the November output cut deal. Russia, an oil-producing non-OPEC country, has also signaled it is weighing an extension of OPEC-led production cut agreement. Their formal decision will be delivered at the end of May. It will be clear whether OPEC and non-OPEC countries will continue to curb their output and supplies or not. An extension of the accord will allow prices to rebound.
Towards the end of spring, the US crude supply will be partially whittled down as refinery utilization will pick up. At this period of time, US fuel producers typically boost crude processing as they start storing up fuel for the future supply (the demand for fuel normally increases in summer). The excessive utilization of crude oil by US refineries will allow us to wager on the further surges in oil prices.
Crude oil futures surged on Monday due to disruptions in Russian refining capacity caused by Ukrainian drone strikes and Moscow's decision to cut output to comply with OPEC+ targets. The West Texas Intermediate (WTI) contract for May settled at $81.95 a barrel, up $1.32, while the Brent contract for May settled at $86.57 a barrel, also up $1.32. Russia instructed...
Brent oil is currently on a bullish trend, facing resistance near $84 and supported by the 200-day EMA. Breaking above this level could lead to a climb towards $90. Short-term support is observed around $80, backed by the 50-day EMA. As summer approaches and travel increases, crude oil tends to benefit from seasonal patterns. Despite temporary setbacks, buying...
Amid uncertainty driven by geopolitical events, oil prices surged to record highs. However, a correction in oil prices is observed with a gradual improvement in the situation in the Middle East and an increase in demand. The question facing investors is whether there are prerequisites for further price growth or if everything depends on the dynamics of the political landscape. In this article, we will explore the impact of recent events on the global oil market and the prospects for developing this crucial commodity sector.
Jerome H. Powell, the Federal Reserve chair, stated that the central bank can afford to be patient in deciding when to cut interest rates, citing easing inflation and stable economic growth. Powell emphasized the Fed's independence from political influences, particularly relevant as the election season nears. The Fed had raised interest rates to 5.3 ...
Hello again my friends, it’s time for another episode of “What to Trade,” this time, for the month of April. As usual, I present to you some of my most anticipated trade ideas for the month of April, according to my technical analysis style. I therefore encourage you to do your due diligence, as always, and manage your risks appropriately.
Bearish scenario: Sell below 1.0820 / 1.0841... Bullish scenario: Buy above 1.0827...
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