Crude Oil Price Forecast February 20, 2018, Technical Analysis

Ashley Carr
February 21, 2018

Oil markets were split on Tuesday, with USA crude pushed up by reduced flows from Canada while worldwide Brent prices eased.

West Texas Intermediate for March delivery, which expires Tuesday, rose 0.7 percent to $62.10 a barrel on the New York Mercantile Exchange.

The US dollar index which measures the greenback's strength against six other major rival currencies climbed 0.5 percent to $89.56.

The WTI Crude Oil market rallied a bit during the day on Monday, as we continue to see a bit of a relief rally after the massive selloff.

Plans for a super group of oil producing countries could be in place by year-end as Opec works to institutionalise the ongoing collaboration between 24 member and non-member nations that has helped crude prices to recover, said a report.

A more robust dollar makes oil and other dollar-denominated commodities more expensive for holders of other currencies.

Money managers slashed their bullish wagers on ICE Brent crude oil futures by the most in almost eight months in the week to February 13, data showed, as prices plunged amid concerns of oversupply. Prices rallied to a high of $62.74 a barrel early in the session, the highest since February 7.

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Oil prices are rising on Monday with the recovery in Asian stock markets, as well as the escalation of tensions in the Middle East.

The most active gold futures contract on the Comex market in NY touched a high of $1,358.60 an ounce in midday trade, up more than 2pc or almost $30 an ounce compared to Tuesday's settlement after inflation data in the United States came in higher than expectations.

However, since the data was compiled, Brent crude has risen almost 5%, and Tuesday's drop looked more technical rather than based on supply and demand fundamentals. Premiums for local North Sea grades are at multi-month lows.

Crude climbed above $62/bbl for the first time in more than a week as an alliance of some of the world's largest oil producers signaled further cooperation to tighten supplies through the end of the year.

WTI's positive reaction appeared, therefore, to be largely supported by demand and supply fundamentals in its domestic market.

Ayed Al Qahtani, OPEC's head of research, said the excess of oil held in storage has fallen in the past year to stand 74 million barrels above the five-year average.

Other reports by My Hot News

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