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Brent crude oil declines

8/31/2022 1:10 PM

Benchmark Brent Crude Oil price is correcting, trading just below 99.00.

After a significant increase, quotes returned to levels below 100.00 and, according to leading experts, the downward dynamics are due to reports from the Iraqi State Oil Company (SOMO), which indicate the intention to continue continuous export of fuel, despite ongoing mass protests, which, in turn, weakened the fears of investors about the shortage of raw materials. European countries are currently called the key direction of supplies, and, according to SOMO, if buyers express interest, the company is ready to increase the volume of transportation of “black gold” to the region from 20% to 40%, for which the delegation has already gone to Germany for negotiations.

An additional pressure factor on the quotes was the statistics on stocks from the American Petroleum Institute (API), according to which the index rose by 0.593M barrels after falling by 5.632M a week earlier.

As for the demand for oil contracts from investors, last week, there were global changes: according to the US Commodity Futures Trading Commission (CFTC), the number of net speculative positions for the first time since the beginning of summer reached 246.2K, rising from 214.9K contracts a week earlier, which may be the primary sign of a change in the trend in the asset.

On the daily chart of the asset, the trading instrument has left the limits of the local downwards channel, having overcome the resistance line. Technical indicators reversed upwards: fast EMAs of the Alligator indicator crossed the signal line upwards, and the AO oscillator histogram forms upward bars in the buying zone.

Resistance levels: 102.53, 111.97. | Support levels: 96.48, 91.16.

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