- WTI has dipped slightly to $103.00 in trading ahead of the long weekend.
- For now, WTI above $100 seems to make sense amid expectations of tight global market conditions amid supply outages in Russia.
Trading conditions have been quite weak in global oil markets on Thursday amid a slowdown in the flow of relevant news and as traders relax ahead of a long weekend in major North American and European markets. WTI Futures of the previous month they have dipped a bit to trade at $103.00, a bit below Wednesday’s highs for the week at $104.00.
For now, the 21-day moving average at $104.15 is acting as a ceiling for price action and this is likely to remain the case for the rest of the week. For now, traders seem to see crude oil slightly above the $100 level as making sense overall. Market conditions are expected to remain tight in the coming months as global oil markets adjust to the significant disruption to Russian exports as a result of sanctions over the country’s invasion of Ukraine.
The International Energy Agency (IEA) earlier in the week forecast a loss of 3 million barrels of Russian crude per day from May (about 3% of global supply) as a result of sanctions and buyers who voluntarily refused the degrees of Russian crude. This is the main reason why dips below $90 a barrel in WTI continue to be bought.
However, the prospect of a return to last month’s high of $120 has been overshadowed by recent announcements by IEA member countries of a historic release of crude oil reserves amounting to 240 million barrels over the next few years. next six months. Other factors to consider are the potential for a return to the market of more than 1 million barrels per day (BPD) in Iranian supply if the US and Iran are able to negotiate a new nuclear deal to ease sanctions.
For now, though, talks remain deadlocked, with traders also monitoring the prospect of increased production from the US, Venezuela and OPEC+ nations, which are sticking to their policy of quota increases for now. production of 400,000 BPD/month. Other factors on oil traders’ radars include the demand side as global growth slows and the threat of broader lockdowns in China remains.
Technical levels
Source: Fx Street
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
