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Oil MayDive Deeper Awaiting for EIA data

Olymp Trade

As expected in the last review, Brent crude oil began to consolidate in the $60-63/b zone. The local resistance is at around $62.2. With a high probability, the sideways nature of the movement will continue until the data announcement of crude oil inventories in the United States, which will be released on Wednesday. Last 2 weeks, at the time of this macrostatistics releases bearish impulses, began on the market, eventually lowering the price by $11 or 15%. One way or another, at the time EIA announces official data, market volatility will be hugely increased. According to information from the American Petroleum Institute (API), reserves might grow by 3.5 million barrels per week, to 478 million. If this data will be confirmed, it is quite possible for further price reduction.

The fundamental background does not add optimism. Saudi Arabia, the leader of OPEC, announced that an agreement to extend production reduction had been reached. However, the vision of Russia on this issue may alter in the current environment. Igor Sechin, the head of Rosneft, questioned the feasibility of reducing oil production because it would be replaced by US production. He believes that Russia should produce as much oil as it wants. He also added that if the restrictions on oil production are extended, he will demand compensation from the government.

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Source: https://olymptrade.com/
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