The crude oil prospect market is dimmed by the debt ceiling crisis. Mounting economic threats and the U.S. debt ceiling standoff are expected to have an impact on oil prices.
Crude Oil prices have fallen for four weeks in a row, indicating that bears are still in charge.
In response to mounting concerns about a U.S. recession and its negative impact on cyclical commodities. Crude oil prices (as measured by WTI front-month futures) declined on Friday. It was retracing just over $70.00 per barrel, and finishing down for a fourth straight week.
Even though the US is not currently in a recession, market indications like the inverting of the yield curve. Indicate that it may happen soon. Although the picture is still uncertain and prone to shifts, the current instability in the U.S. Financial industry has subsequently increased the potential of a slump by reinforcing downside risks.
Global Recession is a threat to oil prices
With the most significant GDP in the world, the United States, a recession could significantly slow down the world’s growth and lower demand for fossil fuels globally. Considering the anticipatory nature of markets, this might have a negative effect on oil prices. With the majority of losses likely focused toward the start of the drop.
Energy commodities are suffering due to the mess with the US debt ceiling. Although the US reached its debt ceiling in January. The Treasury Department is able to keep up with its obligations using unique methods. However, if the federal government does not take remedial action, available funds might run out as soon as June.
If the country’s borrowing limit is not lifted quickly, a default may happen in only a couple of weeks. With disastrous implications for the financial system and economy. Democrats and Republicans will most certainly work out a compromise at the very last minute. But that may not happen until the markets start to panic and crash.
Crude prices are likely to remain subdued presently
Oil prices will likely stay low given the present situation, which means further losses may be in store. In the next few days. Traders should closely follow the news to avoid falling on the wrong end of the trade since market circumstances might quickly turn fairly dangerous with the sentiment on shaky ground.
Crude Oil Technical Perspective
WTI oil is resting above trendline support at the $70.00 level after recent losses in terms of technical evaluation. If bulls are unable to protect this support level and sellers effectively push prices below it. An extra slide toward $65.00 may be on the horizon. When there is more decline, bears could try to reach the 2023 lows as well.
On the other hand, early resistance is seen at $72.00 if prices rise from present levels. A breakout over this resistance level would pave the way for a surge above $73.75, then 76.50.
Crude Oil Estimations Based on Prevailing Fundamental Conditions
On Monday, May 15, the price of oil is expected to be 72.82 dollars, with an estimated range of 76.46 to 69.18. Tuesday, May 16 Brent oil price prediction: 71.72 dollars, high 75.31 dollars, low 68.13 dollars. Wednesday, May 17 oil price prediction: 71.13 USD, max 74.69 USD, low 67.57 USD. Estimate for the price of Brent oil for May 18: 71.74 USD, peak 75.33 USD, the least 68.15 USD. Estimate for the price of oil for May 19: 73.04 USD, with a price range of 76.69 to 69.39 USD.
Disclaimer
The estimate is given “as it is,” and the company disclaims all liability for any inaccuracies or omissions. This projection relies on reports from market intelligence, information, and news sources. economic signaling. prevailing circumstances. Thorough technical & fundamental examination. and might alter at any time without warning. The use of this estimate may cause losses for which the firm is not liable.
