Prices Stabilise As Fundamentals Come To The Fore

Oil prices stabilised on Tuesday with Brent trading above $90 again after spending most of the APAC session below. After falling around 2% on Monday, continued increases in US yields and the greenback didn’t worry it further as tight supply fundamentals took centre stage again. The USD index rose 0.2%.

• Brent rose 0.3% to close at $91.01/bbl. It reached a high of $91.56 during NY trading. It broke through support of $90.41 earlier strengthening the bearish theme but the uptrend remains in place and Brent is in a corrective cycle. Initial support is at $87.37 and resistance at $95.35, the bull trigger.
• WTI is 0.7% higher but continues to trade below $90. It finished at $89.45/bbl and has started Wednesday at $89.41. It made an intraday high of $90.27 but the break above $90 was short lived. Support at $88.19 was breached with WTI reaching a low of $87.76. This signals a move towards $84.37, the 50-day EMA. Initial resistance and bull trigger is at $95.03.
• Bloomberg is reporting that there was a 4.21mn barrels US crude stock drawdown in the latest week according to people familiar with the API data. Gasoline rose 3.9mn and distillate 0.3mn.
• According to Bloomberg, Russia is considering a lift of its diesel export ban but an announcement is yet to be made. This would put downward pressure on prices.