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Brent Crude Oil Market Destabilized Amid Reports from Libya

3/16/2023 1:38 PM

Benchmark Brent Crude Oil price is correcting, trading just above 74.00.

The stability of the oil market, which has been observed since the beginning of the year, was interrupted by yesterday's reports from Libya, where the International Atomic Energy Agency (IAEA), during inspections of nuclear facilities, which are now controlled by the government, discovered the absence of 10 barrels of natural uranium in concentrate form. The total weight of the missing radioactive material is 2.5 tons and represents a significant safety hazard. In 2003, the country under the leadership of Muammar Gaddafi abandoned its nuclear weapons program, and now, against the incident, a sharp deterioration in relations between the interim government and Western countries is expected, which will inevitably affect the supply of Libyan oil to the market.

In February, Japan purchased 232,700 barrels of oil from the Russian Federation at an average price of 68.5 dollars per barrel, which exceeds the 60.0 dollars per barrel ceiling supported by the Japanese government and calls into question the effectiveness of sanctions measures.

Inventories of hydrocarbons showed positive dynamics, having risen by 1.155M barrels according to the American Petroleum Institute (API), and by 1.550M barrels, according to the report of the Energy Information Administration of the US Department of Energy (EIA).

On the daily chart, the price has left the local ascending corridor with dynamic boundaries of 82.50–92.50, consolidating well below the support line at 82.00.

Technical indicators maintain a stable sell signal: fast EMAs of the Alligator indicator are moving away from the signal line, and the AO histogram is forming downward bars, falling in the sell zone.

Resistance levels: 76.50, 82.50. | Support levels: 72.40, 67.00.

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