- WTI has been oscillating between the $112 area and above $116 as traders weigh various issues.
- Traders remain concerned about Russian supply disruptions due to Western sanctions as US-Iranian talks falter.
oil markets have seen volatile trading so far this Thursday, with traders busy with a multitude of topics. The WTI It swung between multi-week highs above $116.00 and $112, and is currently trading at $113, down $1 on the session. Declines towards $110 attracted solid demand as energy market participants continue to weigh the size of the Russian oil supply loss. IEA Executive Director Fatih Birol said on Thursday that the EIA countries were united in seeking to slash Russian imports of oil and gas, and that Western nations had imposed harsh sanctions on the Russian economy for their invasion. from Ukraine.
In that sense, on Thursday there was a flurry of NATO and EU summits where sanctions were tightened marginally, although there was no announcement from the EU about an embargo on Russian oil. While the lack of an embargo will be a disappointment to oil bulls, Russia’s new demand on Wednesday that so-called “unfriendly” countries pay for Russian energy purchases in rubles may act to significantly reduce EU imports. The measure in this case remains unclear, with traders also having to weigh the loss in global supply after it was announced earlier in the week that Russian crude oil exports from the Caspian Pipeline Consortium (CPC) terminal in Kazakhstan had stopped due to storm damage.
Updates on the US-Iran negotiations to return to the 2015 nuclear pact and the removal of sanctions on Iranian oil exports have also been negative of late, reducing the chances that 1.3 million barrels per day or more of Iran’s much-needed exports return to global markets at any time. “Unless Iran is allowed back on the market quickly, it is hard to see how a further price increase, potentially above recent highs, can be avoided,” analysts at PVM said.
Although the rumor about another coordinated release of crude oil stockpiles appeared to cap WTI gains in the $116 area on Thursday, any bearish impact is likely to be limited or short-lived as official inventory data on Wednesday showed that the US Strategic Petroleum Reserve (SPR) is at its lowest level since 2002. WTI bulls are likely to seek a run to $120 and return to multi-year highs in the $130 zone touched at the beginning of this month.
Technical levels
Source: Fx Street
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