Crude Oil News | Hanging by a Thread at Key Support—What’s Next?

Crude oil at Key support, will it break or not?

Crude oil fall drastically yesterday, prices touched over three months low, weighed down by concerns over waning demand in the world’s top oil consumers, the United States and China as per the latest crude oil news and analysis.

Adding to this, U.S. crude oil stocks rose by almost 12 million barrels last week, market sources said late on Tuesday, citing American Petroleum Institute figures.  The U.S. Energy Information Administration (EIA) will delay the release of weekly inventory data until the week of November 13, 2023.

Crude oil production in the United States this year will rise by slightly less than previously expected while demand will fall, the EIA said on Tuesday. The EIA now expects total petroleum consumption in the country to fall by 300,000 bpd this year, reversing its earlier forecast of a 100,000-bpd increase. The agency also forecast Venezuela’s crude oil production will increase by less than 200,000 barrels per day (bpd) to an average of 900,000 bpd by the end of 2024 under easing of U.S. sanctions.

As per the latest crude oil news from China, the world’s biggest crude oil importer has also raised doubts about the demand outlook. Crude oil imports by the world’s second-biggest economy in October showed robust growth but China’s total exports of goods and services contracted at a quicker pace than expected, adding to fears of weakening global demand.

Adding to pressure on oil prices was a modest recovery in the U.S. dollar from recent lows, which makes oil more expensive for holders of other currencies.

On the brighter side, the oil producing group OPEC expects the global economy to grow and drive fuel demand, despite economic challenges, including high inflation and interest rates as per the latest crude oil news.

Meanwhile, China is expected to hit its annual gross domestic product growth target this year, the country’s central bank governor said on Wednesday. Beijing has set an economic growth target of around 5% for this year.

Fed Chair Jerome Powell, due on Wednesday and Thursday which will have strong impact on the Oil prices.

Crude Oil News | Technical Outlook

Crude oil has been traded in bearish momentum since 20 Oct 2023.00. Prices continued plunging from the peak of 7474 and recently it made a low 6429, that was lowest after 24 August 2023.00

On the chart, prices formed a long bearish candle stick and also trading below its 200 SMA. Both of which are indicating for bearish momentum in near future. Further, as per the Elliott wave drawn on the chart, prices trading under the corrective wave C that would complete around 6280-6200 levels.

However, prices would need to break below 6375 in order to extend fall. Else, any short time jump towards 6650-6670 will attract selling pressure.

Alternatively, on the upside, massive resistance is seen at 6745 and a break above only trend will change, and prices may recover towards 6855-7065.

Commodity Samachar
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