Brent Crude Oil: Price Is Under Pressure
LiteForex Europe | Mar 26, 2017 02:50AM ET
This week the oil prices continue to lower and on Wednesday decreased below 50 dollars per barrel for the first time this year. The US oil (NYSE:USO) resource began to grow again, which created disagreement of the oil exporting counties upon the lengthening of the OPEC+ Agreement for 6 months. Saudi Arabia is optimistic and the Energy Minister Khalid Al-Falih noted the possibility of lengthening. However, the part of the non-OPEC oil exporting countries, including the Russian Federation, says that the growth of the shale oil production in the USA significantly lowers the impact of the agreement, and the lengthening is unlikely.
Now the oil prices are supported by the Saudi Arabia oil export to the USA limitation data (by 300K barrels per day on average in March). The price grew to the level of 50.90, but the Baker Hughes US Oil Rig Count publication can change the situation. The further growth of the index will reflect the expansion of the US shale oil in the market and can press the prices significantly.
Technically the key level is at 50.00, in case of the breakout here the price can lower to the level of 49.30 and 47.50. On the other hand the price is testing the middle line of the Bollinger Bands® indicator in the area of 50.80 (Fibonacci correction 50.0%). If the price is set above this level, the “bulls” target will become the level of 51.60 (correction 23.6%) and 52.35 (correction 38.2%). The technical picture reflects the growth, the Stochastic reversed upwards, the MACD histogram is decreasing in the negative zone.
Support levels: 50.00, 49.30 and 47.50.
Resistance levels: 50.80, 51.60, 52.35.
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