Crude Prices Fade Off Highs, But Momentum Still Tilted Higher

• WTI and Brent crude futures both trade in minor negative territory ahead of the NY crossover, but both benchmarks hold close to recent highs. Brent crude - the contract in focus - has dipped back below the $100/bbl level, with gains fleeting above that handle as markets gauge inputs from both OPEC and the US, who will likely be able to justify production increases in the face of current high prices.
• Yesterday, in his televised press conference, POTUS Biden stated that while the US and partners will not impose a ban on the SWIFT banking system for now, the US will release additional oil from the Strategic Petroleum Reserve as needed - helping keep a lid on prices near current levels.
• The late Thursday rally for US equity markets also feeds well into a retreating oil price, with sanctions that avoid impacting the Russian energy industry and no removal from the SWIFT payment system reducing the risk of a material supply disruption in the near-term.
• Volatile price action in Gold Thursday saw the yellow metal reverse sharply from the session high of $1974.3. The outlook is bullish however following recent impulsive gains. Gold is back inside its bull channel, drawn from the Aug 9 2021 low. The channel top intersects at $1939.2 today and represents a key short-term resistance. Watch support at $1878.4, yesterday’s low.
• WTI futures remain in an uptrend despite the pullback from yesterday’s high. The $100.00 level has been probed and a clear breach of this psychological barrier would strengthen current trend conditions. This would open 102.01 next, 3.382 projection of the Dec 2 - 9 - 20 price swing.

Source: MNI/BBG