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Crude Consolidates Yesterday’s Rally With Weekend OPEC+ In Mind

  • Crude front month futures have traded in a relatively narrow range today, broadly consolidating yesterday’s strong gains with an eye on this weekend’s OPEC+ meeting with the market torn between voluntary cut extensions or the possibility for them to deepen.
  • The OPEC+ meeting is clouded by an unexpected crude supply side coming from Iran. It’s oil minister said Tuesday that oil output from the country is expected to rise to 3.6mbpd in March next year – up from 3.4mbpd currently. Most of its flows area heading to China.
  • Saudi Arabia is likely to extend its 1mbpd oil output cut through 1Q 2024, and Russia is expected to do the same to its current 300kbpd cut of crude and oil products exports, while a deepening of cuts is not included in the base case, Citigroup said in a client note.
  • WTI is -0.2% at $77.69, haven’t not troubled resistance at $78.81 (20-day EMA) or support at $72.37 (Nov 16 low).
  • Brent is flat at $82.31, off resistance at $83.97 (Nov 14 high) and support at $76.60 (Nov 8 low).
  • Gold is +1.1% at $2000.23, pulling back off highs of $2007.61 with some intraday strengthening in the USD index. It has cleared $2,000/oz in spot trade, for the first time since late October. Technically, well-defined parameters remain in play and bulls remain in control at present. A stronger resumption of gains would open $2,022.20/oz (the May 15 high). The bull trigger at $2,009.4/oz (the Oct 27 high) provides initial resistance ahead of there.

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