- WTI pops as stocks stablise.
- WTI is currently -0.38% at the time of writing having traded between a day's range of 56.91bbls.-59.06bbls
Oil prices have been under pressure due to global growth concerns due to a run of underperforming global economic data as well as a protracted trade standoff between Beijing and the US. The price of oil has been tracking the stock market and is traded as a risky asset class as well. However, in recent trade, we have seen a jump in prices from the lows of $57.84bbls to current levels at $58.84bbls the hourly high. This has also coincided with a correction in the stock market, with the DJIA moving up from 24938 to hourly candlestick high of 25107, although still down just over 1% on the day.
Besides the ongoing trade war anxiety, in contrast, Venezuelan production is in freefall, Libyan output is at risk following an insurgency. However, on the demand side, the macro backdrop remains relatively weak as the macroeconomic data and global trade growth prospects have been weak, as noted by analysts at Danske Bank. This brings in the next major risk being OPEC. The group will meet on 25 June to discuss the extension of current cuts and the analysts at Danske Bank argue that adjustments to production should mitigate the effects of Iran, Libya and Venezuela. "We see Brent on average at USD70/bbl in Q2 and USD80/bbl in Q4."
Eyes on U.S. petroleum supplies
Looking ahead, we have the delayed weekly data on U.S. petroleum supplies with the American Petroleum Institute releasing its figures later today while the Energy Information Administration’s report is due Thursday morning.
WTI levels
On the downside, eyes will now turn to $55.70 and 50% Fibonacci retracement near $54.40. On the upside, $59.55 $60.10 are resistances guarding 23.6% Fibonacci retracement near $60.85 and then to $62.20.
D
D
, we'll see
