Momentum Wanes, 20-Day EMA Capping Brent Upside

Brent crude's early rally fizzled out, as we attempted a move towards $82/bbl. We last tracked close to $81/bbl, down slightly for the session. We remain above Thursday's lows, while further support should be evident ahead of $75/bbl. On the top side, resistance is evident above $83/bbl, which also coincides with the 20-day EMA ($82.87/bbl).

• Brent is still tracking higher for the week, +6.60% at this stage. Momentum has faltered though in recent sessions, likely owing to hawkish ECB rhetoric and concerns around the near term demand outlook from China.
• Still, there is a sense of underlying support from the supply side. Bloomberg reports that Russia supply to Asian markets has slowed since the introduction of the price cap, while the IEA earlier this week, stated prices should rise in 2023 on supply issues.
• Looking ahead next week sees EU energy ministers meet Monday to discuss the gas price cap level. Tuesday and Wednesday deliver the weekly US oil inventory reports.