Karachi, March 06, 2019 (PPI-OT): Crude Oil
The WTI Crude Oil market went back yesterday, as it continue to see a lot of choppiness and volatility. The $58 level above is resistance, just as the $55 level underneath is significant support. This is a market that will probably continue to go back and forth on a short- term basis, as it try to figure out what’s happening next with global growth. Brent looks very much the same, as it just don’t know where to go next. While it had a nice rally higher, it is stuck between the 50 day EMA on the bottom and the 200 day EMA on the top. If it do break out to the upside, it should then go to the $70 level, possibly even the $75 level after that. OPEC cuts could continue to produce upward pressure. If it get a softening US dollar, that could be the “one-two punch” that it need. It seems that it will see the buyers take over, but clearly they are ready to make that stand quite yet.
Oil futures moved lower yesterday, pressured by news that Libya has reopened its largest oil field
China cut its economic growth target for this year to between 6% and 6.5%. An economic slowdown could hurt demand for energy
The oil production of Libya will increase and thus of OPEC, by more than 300,000 barrels per day
The EIA is forecast to report a climb of 1.9 million barrels in crude stockpiles
Oil rose Monday as members of the OPEC and their allies continue to cut back on production levels
Oil prices slipped today as bullish output forecasts by two big U.S producers and a build in weekly U.S crude stockpiles outweighed ongoing OPEC-led production cuts.
International Brent crude futures were at $65.36 per barrel, down 50 cents, or 0.8 percent, from their last settlement. U.S West Texas Intermediate crude oil futures were also down 0.8 percent, or 45 cents, at $56.11 per barrel.
Crude oil futures continue to demonstrate whippy trades as markets balance between OPEC-led cuts and the effects of rising U.S production levels. Meanwhile, the market is looking for further signs that the United States and China are making progress in talks to resolve their trade conflict.
U.S crude inventories rose by 7.3 million barrels in the week ending March 1 to 451.5 million, compared with expectations for an increase of 1.2 million barrels, API said.
An increase in U.S crude inventories is weighing on oil prices and in the long term, concerns over rising oil production in the Permian region is keeping a lid on prices.
OPEC and its allies pledged to curb output by 1.2 million barrels per day, and they are likely to push back their decision whether or not to extend the output cut agreement to June from April.
Prices in recent session have also seen support as members of the Organization of the Petroleum Exporting Countries and their allies continue to cut back on production levels. OPEC members pumped 30.68 million barrels a day in February, the lowest since 2015.