Crude Falls Through Support Levels On Fed Fears

Oil prices are down around a percent so far in APAC trading with Brent falling below $90 and WTI below $88 on a stronger greenback and a general pullback in risk driven by expectations that Fed policy will need to remain restrictive for longer. Brent is now down 5% since last Wednesday but market fundamentals remain positive. The USD index is up 0.2% after 0.8% on Monday.

• Brent broke through support at $90.41 opening up $87.37, the 50-day EMA. It is currently trading around $89.72/bbl, close to the intraday low. WTI is below initial support of $88.19 opening up $84.19. It reached an intraday low of $87.76 and is now around $87.91.
• According to Bloomberg, OPEC will have an online meeting on Wednesday to discuss the current position of global markets. Output was constant in September and its current stance is unlikely to be altered.
• The US is seeing an increase in oil output supported by the rise in prices since June but despite this inventories have continued to be run down. Later today US stock data from API is released.
• Later the Fed’s Bostic speaks on the economic outlook and inflation. On the data front, there are US JOLTS job openings for August, which are expected to be steady.