Although on course for back-to-back weekly gains, oil’s advance for the week was significantly pared after Russia hinted that another OPEC+ supply cut may not be forthcoming at its early June meeting.
That leaves oil benchmarks still caught up in the market’s cross currents, ranging from optimism surrounding a US debt deal to the prospects of further demand-destroying Fed rate hikes.
Should US lawmakers soon clinch a deal to raise the debt ceiling, that may offer further some measure of relief for oil.
From a technical perspective, Brent’s climb was thwarted by its 50-day simple moving average (SMA), with the widely-watched technical indicator now acting as the critical resistance level.
Barring further OPEC+ intervention on global supplies, oil benchmarks are set to remain primarily gripped by demand-side woes, leaving oil bulls to bide their time before potentially restoring prices back to the $80/bbl handle.
Markets are widely expecting that OPEC+ would stand pat on its production levels at its weekend meeting.
2 June 13:21
The global oil benchmark is on course to post a weekly advance of over 3%, ending a run of four straight weekly declines.
19 May 13:27
As mentioned in last Friday’s article, “Brent’s recent rebound is unlikely to be sustained …”. Sure enough, the global oil benchmark is unwinding some of its technical rebound, as demand-side fears continue to fester across markets.
12 May 12:21
Brent’s recent rebound is unlikely to be sustained as long as negative sentiment continues to cloud oil markets.
5 May 11:57
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