The upward trend in oil prices continues
A barrel of Brent oil is quoted at $92.50 in international markets.
The price of a barrel of Brent oil, which rose to $92.84 yesterday, ended the day at $91.88. The price of a barrel of Brent oil increased 0.67 percent compared to today’s close at 9:45 a.m., reaching $92.50. At the same time, West Texas Intermediate (WTI) crude oil sold at $89.14 per barrel.
The upward trend in oil prices continues, reaching the highest level of the year. The announcement by the world’s largest oil producers, Saudi Arabia and Russia, that they will continue to implement the decision to voluntarily cut supply until the end of the year continues to drive prices higher.
OPEC expects prices to continue rising
In their monthly reports published this week, the Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency shared their expectation that prices will continue to rise due to the contraction in global supply in the rest of the year.
On the other hand, concerns that the economic slowdown in the United States and China, the world’s largest oil consumers, will reduce demand is holding back price growth.
The fact that the inflation announced yesterday in the US has exceeded expectations in annual terms has relatively increased the possibility that the US Federal Reserve (Fed) will raise interest rates again during the rest of the year. As concerns continue over economic activity on the Chinese side, international credit rating agency Moody’s changed its outlook for China’s real estate sector from “stable” to “negative.”
Market players are closely monitoring US and Chinese economic data for clues about future economic activity.
EIA: DEMAND FALLS IN THE US
Additionally, the U.S. Energy Information Administration (EIA) announced data showing that oil demand began to decline as the U.S. summer season ended. The EIA reported that commercial crude oil inventories in the country increased by approximately 4 million barrels last week to 420 million 600 thousand barrels. The market expectation was that inventories would increase by 1 million 174 thousand barrels. During the aforementioned period, United States gasoline reserves increased by 5 million 600 thousand barrels and reached 220 million 300 thousand barrels.
Rising oil and gasoline stocks beyond expectations point to declining demand in the world’s biggest oil consumer, putting downward pressure on prices.
It is stated that technically for Brent oil the range between $92.56 and $92.64 can be considered resistance and the range between $92.26 and $92.19 as support zone. (AA)