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Prices for "Black gold" Remain Under Pressure

11/22/2022 11:26 AM

During the Asian session, prices for Brent Crude Oil show ambiguous trading dynamics, holding at 87.15.

Yesterday, the trading instrument was actively declining, having renewed record lows since the beginning of the year, but the "bears" failed to consolidate on new levels. The active downward dynamics were due to the expectation of additional restrictions on the supply of raw materials from Russia. According to Bloomberg, on November 23, the G7 may announce a price ceiling for Russian "black gold" if the ambassadors approve the initiative of European countries. Previously, the partners considered a scenario with a value around 40.0–60.0 dollars per barrel, but experts note that it may be even higher. The restriction on the transportation of crude oil from Russia will come into force on December 5 and for oil products on February 5, which will be a response to the special military operation initiated by the Russian authorities on the territory of Ukraine. In turn, Deputy Prime Minister of the Russian Federation Alexander Novak stressed yesterday that if a ceiling price level consolidates, Russia will redirect supplies or even reduce production, which, in his opinion, will create an even greater shortage of resources. Against this background, information appeared that OPEC+ was preparing to increase energy production to compensate for a possible drop in supply in the European market. Still, later, representatives of Saudi Arabia denied this, resulting in quotes being able to regain their positions lost on Monday almost completely.

The focus of investors will be the publication of the minutes of the US Federal Reserve on Wednesday. Analysts will look for hints of further weakening of the hawkish rhetoric of the US regulator as the situation with consumer inflation in the country stabilizes. On Tuesday, investors will pay attention to the publication of the next report from the American Petroleum Institute (API) on oil inventories for the week of November 18. Earlier, the data reflected a sharp drop in inventories by 5.835M barrels, while the Energy Information Administration of the US Department of Energy (EIA) reported a reduction of stocks by 5.4M barrels.

On the daily chart, Bollinger Bands are moderately declining: the price range is expanding but not as fast as the "bearish" sentiment develops. The MACD indicator is falling, keeping a relatively strong sell signal (the histogram is below the signal line). Stochastic, having reacted to the corrective growth of the asset, maintains an uncertain upward direction, signaling in favor of further growth of the instrument in the nearest time intervals.

Resistance levels: 88.79, 91.00, 92.47, 94.50. | Support levels: 87.00, 86.00, 84.50, 82.27.

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