Over the two past weeks, the price of WTI plunged slightly by 0.2% to $46.25/bbl. On August, 19, the price of WTI reached its monthly high of $49.01/bbl. The resistance level was raised to $49.5/bbl. However, the prices of crude went down to the support levels of $46-47/bbl.
WTI futures price, August, 02 – 30, 2016
The price of Brent crude was also declining over the two last weeks. It lost 1% and reached $48.3/bbl. The spread between the prices of Brent and WTI shrunk to $1.2, and that means volatility on the crude oil market began to reduce.
The new level of resistance for the price of Brent is now above the level of $50/bbl and located at $51.3/bbl. If Brent manages to remain above this level, it is likely to rise to $55/bbl and higher.
Brent futures price, August, 02 – 30, 2016
Last week the commercial oil stocks in the US rose by 2.28m bbl, while the market expected that the increase only by 0.92m bbl. Baker Hughes reported that the number of active drilling rigs remained unchanged at 406 units last week.
However, the crude oil market is in expectance of the OPEC meeting in September in Algeria. The news from petroleum exporting countries is contradictory. Saudi Arabia is still skeptical about the production cut, while Iran is ready to participate in the production cut, but does not lose its market share.
We expect the prices of Brent and WTI at the next week at the range of 46-49 bbl.