Brent crude oil price tumbled on Friday but recovered quickly and turned green once again. The chart shows that the price has broken through the $88-$89 resistance level and now stands 1.2% above it. The Brent oil price is sitting at $90.5 per barrel, up 0.86% till press time.
Thursday’s pullback in UKOIL can be attributed to the increasing dollar strength. The DXY, which is a measure of the dollar’s strength, is up 1.8% from its August low. This is because the markets are expecting the interest rates to remain high for long.
Brent Oil Price Rises As OPEC+ Extends Cuts
Investors expect oil prices to rise in the future as Saudi Arabia and Russia have announced the extension of their voluntary production cuts through the end of this year. Analysts predict a decline of more than 1.5 million barrels per day in the fourth quarter.
China’s slower-than-expected recovery has been a cause of concern as investors expect a significant fall in demand from the second-largest economy. Despite China raising their crude oil import by 31% last month, the fall in overseas demand and the weak consumer spending may put downward pressure on Brent crude oil price.
Brent Crude Oil Price Breaks Above Crucial Resistance
The following price chart for Brent Crude shows the price breaking through the $88-$89 and making a new yearly high of $91.06. A deeper look at the chart also reveals that the price is retested the $88-$89 multiple times throughout the year before finally breaking out above in September.
The Brent crude oil price forecast can flip very bullish if the price finds strength above the $89 resistance level. The bulls can then expect a 9% rally toward the $97-$99 resistance level. An invalidation of this bullish leg will be a break below the $88 resistance.
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