Eyes on EIA report.
By: Ahura Chalki
Market analyst – IFC Markets
House of Representatives committee approved a bill on Thursday that would open up the Organization of the Petroleum Exporting Countries to antitrust lawsuits. Still, it was uncertain if the full chamber would consider the measure. (Reuters). This news sent the oil deep under $62 last night, especially after the API report, which confirmed the 0.436M increase in U.S. private inventories in the week ended April 16. April. But it is not all; the market also lost interest for the second day on the concern of increasing COVID-19 cases in India, which drive down fuel demand in the world’s third-biggest oil importer.
“You’ve seen refiners there (in India) scale back runs because demand has fallen with the spread of lockdowns; that’s weighing on the market and sentiment,” said Lachlan Shaw, head of commodity research at National Australia Bank (OTC: NABZY).
However, despite all these worries and even increasing concerns in Japan, as the world’s fourth-biggest oil user, there is much other positive news in the market like recovery in the United States, U.K., and Europe. “Driving is soaring in the U.K. as the vaccine rollout accelerates. Such is also the case in the U.S., where drivers consume over 10% of the world’s oil,” ANZ analysts said in a note.
For now, eys turn to EIA numbers, which will be out later today, and the market is expecting a 3M barrel decrease in the official inventory report.
Technical overview – H1 Chart
Technical indicators have mixed signals. Price moves higher while above the OBV trend line, which can read as a positive signal. On the other hand, RSI at 42 cannot confirm enough strength of the trend. Currently, 62.85 and 61.47 are the key Resistance and Support levels. WTI needs to cross or break these levels to gain or lose more.
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