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In Anticipation of a Significant Reduction in Oil Supply in November

11/17/2022 10:32 AM

Benchmark Brent Crude Oil is correcting, trading just below 91.00.

Energy prices are again under pressure after the statistics showed a significant reduction in weekly stocks in the US. Thus, the American Petroleum Institute (API) reported a decrease in the indicator by 5.835M barrels after an increase last week by 5.618M barrels, and the Energy Information Administration of the US Department of Energy (EIA) recorded a correction of the value by –5.400M barrels from 3.925M barrels earlier. Against the backdrop of the rapid depletion of US strategic reserves to 1984 at 392.1M barrels, data on commercial reserves confirm strong oil demand, as indicated by the report of Petro-Logistics, a service that tracks the movement of oil tankers. So since the beginning of November, there has been a serious decrease in supplies by countries that are members of OPEC +. Analysts at the service predict an increase in negative dynamics in November and a correction in exports up to 1.0M barrels per day, which is in line with the cartel's plans to reduce production by 2.0M barrels per day, adopted at the last meeting in Vienna.

It is also worth noting the comments of OPEC Secretary General Haitham al-Ghais, who denied information about receiving a request from the Iraqi authorities to revise the oil production quota. Earlier, Iraqi Prime Minister Mohammed Shia' Al Sudani, according to Bloomberg, announced such plans.

The price continues to trade within the ascending corridor on the daily chart, approaching the support line.

Technical indicators keep an extremely unstable buy signal: fast EMAs of the Alligator indicator are still above the signal line, approaching it closely, and the AO oscillator histogram is forming new ambiguous bars in the buying zone.

Resistance levels: 94.00, 98.87. | Support levels: 89.20, 82.87.

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