WTI Crude oil pricing in the week ahead The technical point to more highs, but geopolitical events become the deciding factor.
Key Points and Considerations
WTI ended up for an additional week in a row, with technical factors pointing to more gains.
The Middle East war is going to be a vital driver, underpinning the price of oil.
The USA and Venezuela Agreement Is not likely to Make Any Significant Effect
Despite a slow Friday which witnessed WTI oil prices oscillate around rises and falls. The oil market is on track for an additional optimistic week. Security concerns keep on eclipse the typical fundamentals in a including as inventory statistics & OPEC leaders’ statements.
The US and Venezuela deal might not heal the supply issues in the short-Term
Previously in the last week, the agreement among Venezuela with the US on relief from sanctions. With a six-month interim license was viewed as a possible benefit. Traders had hoped that this might end in a fresh supply glut, lowering the cost of oil. Yet, analysts caution that this is unlikely considering the state of oil deposits and network as a result of inadequate investment and restrictions. The OPEC, for their part, was singing an identical rhythm. Indicating the expected easing of restrictions will have little immediate effect. Most of this points to a period to come prior to Venezuela resumes its post-sanctions production.
The statements by specialists and OPEC couldn’t have occurred at a tougher moment. with Israel’s launching an assault on ground into Gaza & fresh assaults on Israeli & US sites in Lebanese area & Iraq. While it was not the product of any government, instead of several rebel & terror organizations in the region. The dread of spreading intensified, allowing the price of oil to reclaim $90 per barrel. albeit temporarily. With big news occurring on the geopolitical the forefront, crude oil prices might swing either way
The Fresh GDP likely to Impact the oil Markets
A good US gross domestic product figure might keep oil bullish engaged. Investors had anticipated a worldwide downturn in the fourth quarter of this year. In addition to an increase demand-related worries, that might have pushed the price of oil downward. At this point, there’s been hints that some nations are slowing. Yet it has not deterred oil bullish traders because the OPEC output restrictions are also being prolonged.
A statement from the US Department of Energy, the federal government wants to purchase six million barrels of crude to serve as a SPR by Jan. Reputable sources, the agency intends to establish contracts to buy oil for $79 per barrel. Any developments about this might cause some volatility in the short term.
Yet another topic of concern is Venezuela, given that US sanctions on oil have recently eased. Notwithstanding OPEC and experts’ predictions that little will shift in the immediate term. Any unexpected developments from Venezuela may create instability and send the cost of oil down.
Technical Perspective
WTI’s weekly graph indicates a solid upside, and a possibility of greater high appearing more plausible. Considering the facts, the week’s candle appears to be finished as a hammer. Looking into the technical landscape from the Elliot waves viewpoint. Oil may be entering phase 5, this implies a further rise and another peak prior to a drop. That would put the initial barrier at 92.42 in sight preceding the current top near 95.00. This appears to be related to Foundations at work, since a truce in the Palestine and Israel crisis isn’t seeming probable at this time. A truce would completely change the perspective. Therefore, the technical might give the back burner to a steeper pullback initially.
