Brent Crude Oil Price Climbs to Two-Week Highs On Supply Concerns
Brent crude oil price continues higher for the fourth straight day trading above $43. Crude oil price lost over 6.5% the previous week and breached below the 40 mark after Saudi Arabia and UAE cut their oil selling prices. The rebound from last week low at 39.25 started on Monday helped by the halt in refinery operations in the U.S. Gulf Coast, amid the Hurricanes landing in the region. Almost 27% of oil production in the Gulf Coast was halted.
The American Petroleum Institute (API) reported earlier on the week that inventories in the U.S. fall by more than 9.5 million barrels the previous week. That was below the forecasts of an increase of 2 million barrels. Saudi Arabia announced that exports rose in July to 5.73 million barrels per day recovering from record lows in June.
Better than expected outlook from three central banks this week also supported crude oil prices. Bank of Japan, Federal Reserve and Bank of England have revised higher their forecast for their economies for the full year. Federal Reserve expects that the U.S. economy will shrink by 3.7% in 2020 below the previous forecast of a contraction of 6.5% while now the unemployment rate is expected at 7.6%.
Brent Oil Price Technical Analysis
Brent crude oil price is 0.30% higher at $43.40 having touched earlier the daily high at 443.77 where met the 50-day moving average resistance. The short term technical picture points to higher levels after it tested and bounced the 100-day moving average last week. A move to higher levels, have to surpass first the 50-day moving average at $43.70 and then the 200-day moving average at $44.12. Next supply zone would be met at 46.56 the five-month highs from August 31.
On the other hand, support for Brent crude oil price stands at $43.10 the daily low. More bids would emerge at $41.52 the low from yesterday’s trading session. A break below might challenge for one more time the 100-day moving average at $40.79.