- The West Texas Intermediate (WTI) experienced a notable surge during Thursday’s trading session, reclaiming the price level of $90.50 per barrel before subsequently readjusting towards $89.50.
- The price of crude oil experienced an increase of approximately $2 per barrel during the day, primarily due to ongoing supply constraints that continue to exert upward pressure on barrel prices.
- The intraday prices are anticipated to persistently oscillate around the $90 threshold in the interim, per analysts’ projections of a future attainment of $100.
The West Texas Intermediary (WTI) crude oil barrels experienced a notable surge on Thursday, escalating from the day’s lowest point to reclaim a significant recent peak. The market experienced a decline in momentum as it approached the latter part of the trading day, resulting in a depletion of bullish sentiment. Presently, prices are searching for a stable position slightly below the $90 per barrel threshold.
The OPEC+ producers are persistently implementing a deliberate reduction in production, leading market analysts to anticipate a gradual increase in crude oil prices, potentially reaching $100 per barrel in the forthcoming months.
The Number of Barrels Produced Fell Significantly Due to Supply Restrictions
The extension of Saudi Arabia and Russia’s combined supply cuts of 1.3 million barrels per day until the end of the year is expected to compound further the projected global oil supply deficit of 2 million barrels per day, as anticipated by analysts.
It is anticipated that there will be a reduction in global oil reserves in the forthcoming months due to the depletion of barrels by both governmental bodies and independent producers. This depletion is occurring either to stabilize domestic fuel costs or to capitalize on the increasing prices of barrels.
Given the current situation where oil barrel prices are experiencing significant compression at the point of origin, it is anticipated that oil refiners will be compelled to diligently pursue opportunities to secure a larger share of the limited market. This, in turn, will contribute to an additional increase in upward pressure.
The current state of refinery profit margins is characterized by a notable upswing, reaching a peak that has not been observed in several years. Consequently, facilities within the industry are poised to actively pursue strategies to augment their supply capacities, particularly in response to the upward trajectory of barrel prices.
WTI Technical Forecast and Analysis
The WTI crude barrels experienced a rebound after reaching a recent low of $88.25, subsequently reclaiming the 200-hour Simple Moving Average (SMA) in the vicinity of $89.30.
The intraday prices persist below the previous week’s swing high, above $92.00. However, a potential bullish break of the descending trendline originating from that level may support upward price movements.
The price of US crude barrels has experienced a significant increase of approximately 35% since reaching its lowest point of the year, around $65.00. Recent observations of daily candlestick patterns indicate a notable price expansion, with a clear upward trend moving away from the 34-day Exponential Moving Average (EMA). The current market conditions suggest a potential test of the $85.00 price level.