- The US crude oil offers were shot on Tuesday, compensating for the recent falls as geopolitical tensions increase.
- The energy markets are agitated as the conflict between Israel and Iran extends.
- President Trump hastened to get involved directly in the conflict, turning off the hopes of the market of rapid resolution.
The prices of crude oil West Texas Intermediate (WTI) of the USA again rose to short -term maximums on Tuesday, driven by continuous escalations in the conflict between Israel and Iran. The president of the United States, Donald Trump, is using his favorite policy advertisements tool, social networks publications, to declare his desire for an “unconditional surrender” of the Iranian supreme leader Ali Khamenei, offing the hopes of investors of a rapid and peaceful resolution to missile exchanges between Israel and Iran who have prolonged for five consecutive days.
Rumors in the market are circulating that Iran is looking to increase its rhythm of rocket attacks against Israel on Tuesday or Wednesday, which generates new fears among investors that the Middle East region may not be prepared for a peaceful resolution as fast as many operators had waited at the beginning of the week. The president of the United States, Donald Trump, turned to social networks to transmit direct threats against the Ayatollah Khamenei of Iran, declaring that the US knows exactly where he is, but has no intention of attacking him directly (yet). The escalation rhetoric of the US leader foreshadows a bad future for the hopes of the market of a rapid resolution.
WTI crude oil price forecast
Geopolitical factors have firmly dragged the prices of crude oil upwards, pushing WTI offers above the 200 -day exponential mobile average (EMA) about $ 68,00 per barrel for the first time since the beginning of this year. The offers are stirring in the holders between $ 72.00 and $ 74.00, with a short -term impulse that is expected to remain irregular.
WTI DAILY GRAPH
WTI FAQS oil
WTI oil is a type of crude oil that is sold in international markets. WTI are the acronym of West Texas Intermediate, one of the three main types that include the Brent and Dubai’s crude. The WTI is also known as “light” and “sweet” by its relatively low gravity and sulfur content, respectively. It is considered high quality oil that is easily refined. It is obtained in the United States and is distributed through the Cushing Center, considered “the crossing of the world.” It is a reference for the oil market and the price of WTI is frequently traded in the media.
Like all assets, supply and demand are the main factors that determine the price of WTI oil. As such, global growth can be a driver of the increase in demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can alter the offer and have an impact on prices. OPEC decisions, a group of large oil -producing countries, is another key price factor. The value of the US dollar influences the price of WTI crude oil, since oil is mainly traded in US dollars, so a weaker dollar can make oil more affordable and vice versa.
Weekly reports on oil inventories published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect the fluctuation of supply and demand. If the data show a decrease in inventories, it can indicate an increase in demand, which would raise the price of oil. An increase in inventories may reflect an increase in supply, which makes prices lower. The API report is published every Tuesday and that of the EIA the next day. Their results are usually similar, with a 1% difference between them 75% of the time. EIA data is considered more reliable, since it is a government agency.
The OPEC (Organization of Petroleum Exporting Countries) is a group of 13 nations oil producing that collectively decide the production quotas of member countries in biannual meetings. Their decisions usually influence WTI oil prices. When OPEC decides to reduce fees, it can restrict the supply and raise oil prices. When OPEC increases production, the opposite effect occurs. The OPEC+ is an expanded group that includes another ten non -members of the OPEC, among which Russia stands out.
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.
