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Oil Prices Range Trading As Supply And Demand Concerns Offset Each Other

OIL

Oil prices have been trading in a very tight range after OPEC+ denied any imminent output increases overnight. They also don’t seem to have been rattled by China Covid news today. They are again balancing an uncertain supply outlook and concerns regarding Chinese demand. WTI crude is up 0.3% from the NY close around $80.25/bbl, it has spent the day in a 50c range. Brent is up 0.4% around $87.80.

  • WTI has been trading close to its initial resistance of $80.49. If it breaks this then the next level to watch is $85.60, the 50-day EMA. Initial support is $74.96, which is a key medium-term support level. WTI remains in a bearish trend and has been extending its reversal from $92.53, the November 7 high.
  • The WTI spread between the two nearest contracts is still in backwardation but has narrowed over the week, suggesting an easing of supply pressures.
  • The details of the G7 oil price cap on Russia could be announced as soon as Wednesday, according to Bloomberg. The plan bans companies from providing all shipping-related services to transport Russian oil if it is being sold above a certain price.
  • There is US API weekly crude oil inventory data published tonight. There are also a number of Fed speakers and a bearish tone would weigh on oil prices.
Energy BulletsCommodities
Energy BulletsCommodities

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