Solid News

During the Asian session, Brent Crude Oil prices are developing the “bearish” trend that began at the end of January and testing 81.85, having renewed the local lows of January 11 yesterday.

The negative dynamics are observed against the backdrop of growing uncertainty in the market, as the sanctions pressure on the Russian Federation is expanding, threatening serious disruptions in the oil supply: on February 5, a ban on the import of Russian oil products into the EU comes into force, which will undoubtedly lead to an increase in the price of diesel fuel. According to experts, an additional 600.0K barrels per day will be required to replace the missing volumes. It is worth noting that Europe has already begun to import more diesel from Asia and the Middle East – in December, the figure rose to a record 8.2M tons.

Also, the US continues to see a steady upward trend in energy inventories, signaling low demand amid uncertain economic growth prospects. According to a report by the Energy Information Administration of the US Department of Energy (EIA), last week, the indicator for oil added 4.140M barrels, which is significantly higher than forecasts of 0.376M barrels, gasoline inventories increased by 2.576M barrels instead of 1.442M barrels and distillates – by 2.320M barrels with a forecast of a reduction of 1.300M barrels.

Today, also to the January report on the US labor market, investors will focus on statistics from Baker Hughes on the number of active oil rigs in the US: the previous report showed a decrease in their number from 613 to 609 units, and the continuation of this trend may support the asset.

On the daily chart, Bollinger bands are moderately decreasing: the price range is expanding. However, not as fast as the “bearish” sentiment develops. The MACD indicator rushed down, keeping a strong sell signal (the histogram is below the signal line), and is trying to consolidate below zero. Stochastic keeps its downward direction but rapidly approaches its lows, indicating that the instrument may become oversold in the ultra-short term.

Resistance levels: 82.27, 83.89, 85.15, 86.00. | Support levels: 81.00, 80.00, 78.78, 77.00.