USOIL Decline with A-B-C Mitigation at $75

22 nov 2023

The price of Western Texas Intermediate (WTI) oil experienced a decrease to approximately $77.70 per barrel during Wednesday's Asian session, breaking a three-day upward trend. The downward pressure on crude oil prices is primarily attributed to the anticipation of a significant increase in crude oil inventories in the United States, with a substantial rise of 9.047 million barrels according to the American Petroleum Institute (API) for the week ending on November 17, compared to the previous 1.335 million. This substantial increase in U.S. inventories nullified gains derived from projections of supply restrictions by the Organization of the Petroleum Exporting Countries (OPEC) and allied producers.

At the beginning of the week, oil prices had risen following statements from three OPEC+ sources to Reuters, announcing the group's intention to discuss additional supply restrictions during the November 26 meeting. However, investors remain cautious in anticipation of possible more pronounced supply restrictions, considering the slowdown in global economic growth.

Market expectations regarding the continuation or possible increase in oil production restrictions by OPEC+ in the coming year persist. However, the head of the Oil Markets and Industry Division of the International Energy Agency (IEA), Toril Bosoni, stated to Reuters on Tuesday that the global oil market could see a slight surplus in supply in 2024.

On a technical level, at level 75, a A-B-C mitigation pattern has been identified, suggesting the possibility of a rebound for a slight pullback before continuing the downward trend within the channel. Market participants are likely to pay attention to the Energy Information Administration's (EIA) weekly report on the variation of crude oil and its derivatives in stock on Wednesday.

25 nov 2023

Nota

The price of West Texas Intermediate (WTI), the primary benchmark for oil in the United States, dropped to $75.13 per barrel on Friday. This decline is attributed to the reduction in geopolitical tensions following the release of hostages in Gaza and the initiation of a truce between Israel and Hamas. Despite the temporary relief, the oil market is uncertain due to the postponement of the OPEC+ meeting to November 30, where discussions on production levels for 2024 are taking place. Anticipations of production cuts led to market fluctuations, with a 5% drop on Wednesday, followed by a partial recovery of WTI by 1.30%. OPEC+ is negotiating with African countries on future production, but the outcome is uncertain. The outlook for oil demand in China may weaken due to challenges in the real estate sector, with an expected growth of 4% in the first half of 2024. Expectations of robust non-OPEC production, particularly from Petrobras in Brazil, could limit potential gains in oil prices.