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Oil Supply Tightness Outweighs Demand Concerns, Russia Price Cap Proposals Eyed

  • A mixed session for crude oil but with demand concerns offset by sufficient upside momentum from OPEC members remaining committed to production targets with denial of reports of a 500kbpd increase at the next meeting on Dec 4 along with a weaker USD on the day.
  • Weaker momentum later in the session as the EU looks to soften the Russian oil price cap plan in proposals potentially agreed and announced tomorrow (per Bloomberg), coming after the G7 were seen proposing a $60-70/bbl price range (per WSJ).
  • WTI (CLF3) is +1.4% at $81.19 having come close to probing resistance at $82.43 (Nov 18 high) before retreating. Key medium-term support is still seen at $74.96 (Sep 28 low).
  • Brent is +1.2% at $88.49, having also come close to testing resistance at $90.63 (Nov 18 high) whilst support remains at $82.31 (Nov 21 low).
  • Gold is -0.03% at $1737.50, not troubling resistance at $1786.5 (Nov 15 high, bull trigger) or support at $1718.6 (20-day EMA).

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