Crude Oil Prices Retreat from A 13 Months High

Posted by Adegbotolu Kehinde Erastus -
Scope Markets

Key Points

  • Crude Oil prices could feel the impact of the OPEC JMMC meeting on Thursday which will decide more on the oil supply
  • COVID-19 vaccination also to impact oil prices

Oil prices fell over 1 per cent on Tuesday from a February high of $63.60 ahead of the OPEC meeting. The group, OPEC, reached an agreement last year to cut oil production to keep price supported. The impact of the COVID-19 pandemic led to oil price dropping to $0 a barrel.

 Ahead of Thursday’s meeting, there is speculation that OPEC is likely to increase oil output due to rising demand. Saudi Arabia insists on holding out supply cuts until April. However, other committee members are willing to increase supply output to about 1.5 million barrels per day.

As mass vaccination is moving fast and the global economy is gradually opening up, oil demand is likely to rise. This could compel oil producers to increase production. The Texas winter storm shut down refineries and slashed about 4 million barrels off the US market. As a result, this drove oil prices to their highest in 13 months. However, operations have resumed, and this means surplus inventories, which may force OPEC to shift policy on tight supply.

Technical Outlook

USOIL
USOIL

Looking at the daily time frame, Crude Oil prices have failed to go above $63-$65 resistance levels. These levels happen to be the high of January 2020. Amid speculation of OPEC’s decision to increase oil supply, the price has dropped sharply towards the $59 support level. Scaling down to the 4-hour time frame, the price seems to be supported by an ascending trend line indicating bullish momentum. The outcome of Thursday’s meeting will determine the direction of the Crude Oil price. Excess supply of crude will likely crash oil prices and will breach the $59 support level currently holding price.

USOIL
USOIL

Share this article:

Disclaimer: The article above does not represent investment advice or an investment proposal and should not be acknowledged as so. The information beforehand does not constitute an encouragement to trade, and it does not warrant or foretell the future performance of the markets. The investor remains singly responsible for the risk of their conclusions. The analysis and remark displayed do not involve any consideration of your particular investment goals, economic situations, or requirements.

Funding Methods

Scope Markets
Scope Markets
Scope Markets
Scope Markets
Scope Markets
Scope Markets
Scope Markets
Scope Markets

Awards

Scope Markets
Scope Markets
Scope Markets
Scope Markets

Scope Markets offers institutional and retail trading services to businesses and traders worldwide. Our top management team has more than 20 years of experience in the industry, and we are proud of the solid partnerships we build over the years. Whether it's a business or individual, Scope Markets has a wide range of trading solutions that are compliant, flexible, cost-efficient, innovative, and place the client first.

Contact Us

Registered address:
5 Cork Street, Belize City, Belize C.A.

Email:
customerservice@scopemarkets.com

Tel:
+44 2030 516959

Risk Disclaimer

Please note that forex trading and trading in other leveraged products involves a significant level of risk and is not suitable for all investors. Trading in financial instruments may result in losses as well as profits and your losses can be greater than your initial invested capital. Before undertaking any such transactions, you should ensure that you fully understand the risks involved and seek independent advice if necessary. Please read and ensure you fully understand our Risk Disclosure.

Legal Information

Scope Markets Ltd is a company registered under Belize with Registration Number 145,138. Scope Markets Ltd is authorized and regulated by the International Financial Services Commission of Belize (“IFSC”) under the license numbers 000274/58 and 000274/57. The registered address of Scope Markets Ltd is, 5 Cork Street, 1708 Belize City, Belize.

Restricted Regions

Scope Markets does not offer its services to the residents of certain jurisdictions such as EU Member States, Iceland, Norway, Liechtenstein, Afghanistan, Democratic People's Republic of Korea, Ghana, Iran (Islamic Republic of), Iraq, Libya, Mongolia, Myanmar, Nicaragua, Panama, Somalia, Syrian Arab Republic, Uganda, United States of America, Yemen, Zimbabwe and Canada. Please check Restricted Countries.

This website uses cookies to provide you with the very best experience and to know you better. By visiting our website with your browser set to allow cookies, you consent to our use of cookies as described in our Privacy Policy.

© Copyright 2020 Scope Markets. All Rights Reserved.