Excessive Supply Forcing Oil Prices Down

Alpari

On Monday oil quotes dropped. Brent oil at 10:20 EET was trading at $65.1 per barrel and WTI with delivery in June fell to 58.6 per barrel. By the end of last week, North Atlantic oil for June contracts finished trading at $65.37 per barrel. The price of light crude at the end of Friday’s New York trading session was $57.26 a barrel.

The price of oil on the market is being affected by excessive supply which still isn’t falling despite the lessening in drilling rigs and extraction in the USA. At the moment, we don’t expect a sharp fall in prices since there’s no news to push them to do that. However, a weak correction following a growth last week is likely. Over the course of the day, Brent will be trading between $63.5-66.5 a barrel and WTI between $55.5-58.5 per barrel.

Latest reviews

OPEC+ to halt oil’s drop?

Oil prices have drawn some respite from the US dollar’s pullback this week, even though global recession risks still weigh on the commodity’s outlook.

30 September 11:55

Brent stumbles on stronger US dollar

Oil benchmarks are slipping into the weekend as the US dollar continues pushing higher following the Fed’s recent overt signal to keep pressing on with its aggressive fight against inflation.

23 September 12:21

100bps Fed rate hike could drag oil lower

If the Fed triggers a gargantuan 100bps hike next week, or signals to the markets that the 4.5% peak for the ongoing rate hike cycle is inadequate to tame stubbornly elevated inflation, that may well translate into Brent revisiting its recent cycle low around $87/bbl.

16 September 10:55

Brent oil dragged lower by demand fears

Brent oil is trying to claw its way back above the psychologically-important $90/bbl level, even as it continues to trade around its lowest levels since February. Oil bears took their cues from the “death cross” that formed earlier this week, with the ensuing losses lending credence to such a bearish technical signal.

9 September 12:46

Brent braces for surprise OPEC+ hike

Brent is attempting to hold steady, having plunged back below the psychologically-important $100/bbl mark this week and trading below its 200-day simple moving average (SMA) once more.

2 September 12:13