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Crude Oil Quotes have Paused Growth and are Consolidating Near 80

4/6/2023 1:11 PM

During the Asian session, prices for WTI Crude Oil are slightly reducing, testing the psychological level of 80.00.

After a strong growth last week, quotes slowed down in anticipation of a clarification of the situation on the market and the publication of the March report on the US labor market. Positive dynamics developed against the results of the meeting of OPEC+ members, at which it was decided to reduce oil production by 1.0M barrels per day to maintain stability in the industry. Thus, Saudi Arabia will adjust production by 500.0K barrels per day, Iraq – by 211.0K barrels, and the United Arab Emirates – by 144.0K. Kazakhstan, Oman, Kuwait, Algeria, and Gabon have joined this step. Also, earlier the Russian authorities announced that they were extending a voluntary cut of 0.5M barrels per day until the end of 2023.

Traders reacted to the suspension of the oil pumping from Kurdistan to the Turkish port of Ceyhan. This week, it became known that the Iraqi and Kurdish authorities managed to agree on a deal, and the operation of the pipeline will resume but so far, there has been no official confirmation.

Support for quotes was also provided by yesterday’s report of the Energy Information Administration of the US Department of Energy (EIA) on the dynamics of oil stocks: for the week of March 31, the figure fell by 3.739M barrels after a reduction of 7.489M barrels earlier compared to experts' expectations of –2.329M barrels.

On the daily chart, Bollinger bands steadily grow: the price range narrows but remains quite spacious for the current level of activity in the market. The MACD indicator grows, keeping a strong buy signal (the histogram is above the signal line). Stochastic retreated from its highs and signals in favor of further development of a downward corrective trend in the nearest time intervals.

Resistance levels: 81.00, 83.00, 85.00, 86.95. | Support levels: 79.24, 78.00, 76.00, 74.00.

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