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OPEC+ Rhetoric Supported Oil Quotes

8/24/2022 1:34 PM

The price of North American WTI Crude Oil is correcting within the uptrend around 93.32.

Since the beginning of the year, the United States has been actively trying to influence OPEC+, persuading it to increase oil production and thereby reduce fuel prices on the world market. Still, the cartel ignores these requirements, forcing the American authorities to reduce national strategic reserves to the lowest level since 1985 of 453.1M barrels. It, in turn, puts pressure on energy carriers: since the beginning of summer, prices have already fallen by more than 20 dollars, but yesterday, the alliance members again stressed that they could correct their dynamics with their intervention. Thus, the head of the Ministry of Energy of Saudi Arabia, Salman bin Abdul-Aziz Al Saud, confirmed that OPEC+ would begin developing a new agreement soon, under which the group intends to reduce production, which will normalize the current situation by reducing volatility. Also, the likely positive decision on the "nuclear deal" with Iran and the entry of cheap oil into the market remains a key factor. Thus, Saudi Arabia once again made it clear that the oil quotes and its supply are under full control, and in case of unforeseen circumstances, the organization is ready to intervene immediately.

Investors perceived this situation with a clear positive, and in the first two days of trading during the week, WTI Crude Oil quotes increased by 8 dollars, reaching 93.00 again.

On the weekly chart of the asset, the price left the limits of the local downwards channel, having consolidated above the resistance line. Technical indicators confirm the high probability of continued corrective growth: fast EMAs on the Alligator indicator began to actively approach the signal line, narrowing the range of fluctuations, and the AO oscillator histogram is forming new upward bars, approaching the transition level.

Resistance levels: 96.00, 102.37. | Support levels: 91.33, 85.30.

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