Brent crude has declined by more than 5% since the beginning of the week. Bulls have been failing to gain a foothold above $63.0 per barrel for a long time. As a result, the local low was updated around $60.3. The correction that followed brought quotes above the level of $61.0. If the movement is similar to that of late October – early November, when oil also lost around 5%, then market will return to the range of $62.0-63.0 in a short term. However, if bears gain a foothold below $60.0, the market can expect a full-fledged trend reversal.
On Wednesday, the US reports on its crude oil inventories. It is very likely that this week’s release will cause increased volatility. American Petroleum Institute (API), which collects data from oil storage facilities at will, reported an increase of 5.954 million barrels. At the same time, experts polled by S&P Global Platts believe that the official US oil reserves will grow by 1.6 million barrels, gasoline by 750 thousand barrels, and distillates will decrease by 1.4 million barrels. If at least half of API’s expectations is confirmed, this can cause a new wave of sell-offs in the oil market.