- Crude oil prices are seeing a bit of froth on Tuesday as energies are pulled in multiple directions.
- Offers for a barrel of WTI bounce between $86 and $84.50.
- Crude supply constraints may not be as severe as initially thought, but geopolitical tension still weighs.
He West Texas Intermediary (WTI) is experiencing some ups and downs on Tuesday, but remains capped near the $85.00/bbl price point as energy markets weigh inconsistent results for crude oil markets.
The escalation of the conflict between Israel and Hamas continues to stress crude oil traders, but the lack of an immediate negative impact keeps prices limited. The geopolitical fallout could threaten stability in the nearby Strait of Hormuz, a major energy supply crossing point through which nearly a fifth of all global energy trade flows.
Deep supply cuts by member countries of the Organization of the Petroleum Exporting Countries (OPEC) continue to keep crude oil prices rising, specifically the combined production and export cuts of 1.3 million bpd by Saudi Arabia and Russia . Despite significant supply constraints, which threaten to fall short of global demand, China’s demand for fossil fuels continues to decline as its domestic economy slows more than expected, leaving more barrels of oil sitting on the ground. table.
Iran recently re-entered global oil markets after the US eased restrictions on the country’s exports, and the lack of evidence that Iran was directly involved in the recent escalation of the conflict between Israel and Hamas makes the US. US avoid reinstating restrictions for now.
Hopes for a crude oil export deal between the US and Venezuela remain high, as the US has reached a preliminary agreement to allow the South American country to return to global oil export markets in exchange for that next year’s presidential elections in Venezuela be monitored.
The return of Venezuelan crude exports would be a wave for oil markets, which are already seeing crude reserves rebound more firmly and faster than expected, as global demand struggles to consume enough of the already limited supply. .
Technical outlook for WTI
Intraday action on the WTI chart is being capped by the 50-hour SMA near $85.75, while crude oil prices struggle to regain last week’s late swing towards the $87.00 area. , and Tuesday’s early push towards $86.00 turned out to be short-lived as WTI crude oil barrels get stuck in the $85.00 area.
The daily candlesticks see WTI bids stuck at the 50-day SMA, while energies struggle to push prices in either direction significantly. Crude oil initially rose for four straight months from a 2023 low of $64.31 to a thirteen-month high of $93.98, but WTI is set to buck the trend and see prices soften by October as fears of future supply restriction fail to solidify.
WTI Daily Chart
WTI technical levels
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
