Under Pressure In Asia

WTI is ~-$4.60 and Brent is ~-$4.70, printing $98.40 and $102.10 respectively. Both benchmarks have returned to levels last witnessed on Mar 1, with hope re: the ongoing Russia-Ukraine ceasefire negotiations and a worsening outbreak of COVID-19 in China dominating recent price action.

• On the latter issue, China has reported over 5,000 new COVID cases in one day for the first time since early 2020, with the resulting swathe of localised pandemic control measures applying pressure to the demand side of the equation for crude. The authorities are continuing to expand lockdowns, with over 40 million people now under restrictions re: leaving their homes.
• Ongoing talks surrounding an Iranian nuclear deal remain in the balance, with Iranian officials stating that they would “remain in the Vienna talks” until “a strong agreement is reached”. Apart from the well-documented stalemate re: “important open issues” between various parties, forty-nine U.S. Senate Republicans announced on Monday that they will seek to “reverse” any U.S.-Iran deal signed by the Biden administration, bringing into focus a key Iranian demand that the U.S. implement guarantees that they will not pull out of the agreement in the future.
• From a technical perspective, WTI and Brent have broken below initial support at their 20-Day EMAs, exposing further support at $95.32 and $98.30 respectively. On the other hand, resistance is situated at $115.24 for WTI and $117.73 for Brent.