- Crude Oil dips back near $71.00 as markets price in a fresh string of events in Israel.
- US Secretary of State Blinken tries to step up diplomatic efforts, attempting to broker deal in favor of Harris.
- The US Dollar Index finds support at 104.00 ahead of US Durable Goods.
Crude Oil price is havig a small uptick on Friday despite headlines that US Secretary of State Antony Blinken might be able to get both Israel and Iran at the table for ceasefire talks. The Biden administration is stepping up efforts to broker a ceasefire deal in light of the US presidential election on November 5. A breakthrough would be a win for the Biden administration, for the Democrats, and for Kamala Harris’s chances of becoming President.
The US Dollar Index (DXY), which tracks the performance of the Greenback against six other currencies, is easing further this Friday after disappointing US Durable Goods data for September and ahead of the University of Michigan final October reading. It is important where the DXY closes this Friday, as it will determine if the DXY can rally further next week on the back of uncertainty on the US presidential election outcome.
At the time of writing, Crude Oil (WTI) trades at $71.25 and Brent Crude at $75.07
Oil news and market movers: Rally into next week
- The International Energy Agency (IEA) has warned that global demand growth would continue to weaken due to China’s slowdown and uptake of electric vehicles, Bloomberg reports.
- Next week, all eyes will be on the OIl companies like BP, Shell, Chevron, and ExxonMobil. They will report Q3 earnings during the week. Other big firms due to report include PetroChina, Sinopec, and TotalEnergies, Reuters reports.
- Eni sold a shipment of CPC Blend to ExxonMobil on the Platts window. This year has been tough for Oil refining, according to Neste’s Chief Executive Officer, Reuters reports.
Oil Technical Analysis: Do not forget supply
Crude Oil price has been unable to keep trading above the pivotal levels of $71.46 and $71.68. With falling back below those two important pivotal levels, the risk of more downside could be at hand. Should US Secretary of State Antony Blinken be able to get a ceasefire deal or get the parties at least around the table, more downsides could arise in the Crude Oil price.
On the upside, the 55-day Simple Moving Average (SMA) at $71.68 remains the first level to reclaim. Next up, the hefty technical level at $75.01, with the 100-day Simple Moving Average (SMA) and a few pivotal lines, is possibly the next big hurdle ahead.
On the downside, traders need to look much lower, at $67.12, a level that supported the price in May and June 2023. In case that level breaks, the 2024 year-to-date low emerges at $64.75 followed by $64.38, the low from 2023.
US WTI Crude Oil: Daily Chart
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD struggles to hold above 1.0400 as mood sours
EUR/USD stays on the back foot and trades near 1.0400 following the earlier recovery attempt. The holiday mood kicked in, keeping action limited across the FX board, while a cautious risk mood helped the US Dollar hold its ground and forced the pair to stretch lower.
GBP/USD approaches 1.2500 on renewed USD strength
GBP/USD loses its traction and trades near 1.2500 in the second half of the day on Monday. The US Dollar (USD) benefits from safe-haven flows and weighs on the pair as trading conditions remain thin heading into the Christmas holiday.
Gold flat lines above $2,600 ahead of holiday trading week
Gold price trades flat around $2,610 during the early Asian session on Tuesday. Markets face a relatively quiet trading session ahead of the holiday trading week. The US Richmond Fed Manufacturing Index for December is due later on Tuesday.
Ethereum risks a decline to $3,000 as investors realize increased profits and losses
Ethereum is up 4% on Monday despite increased selling pressure across long-term and short-term holders in the past two days. If whales fail to maintain their recent buy-the-dip attitude, ETH risks a decline below $3,000.
Bank of England stays on hold, but a dovish front is building
Bank of England rates were maintained at 4.75% today, in line with expectations. However, the 6-3 vote split sent a moderately dovish signal to markets, prompting some dovish repricing and a weaker pound. We remain more dovish than market pricing for 2025.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.