Crude oil price on the Brent benchmark is falling today as the impact of OPEC’s predictions on crude oil demand growth this year continues to weigh on the black gold. Data from the US energy information administration shows that crude oil inventories fell by more than expected as the week ended October 9. Crude oil inventories fell by 3.8 million barrels, and this was higher than the 0.5 million barrels that were added last week as well as 2.4 million barrels shortfall that the markets had predicted.
Additional information from the EIA’s report showed that US crude oil refinery inputs averaged 13.6 million barrels per day; a reduction of 277,000 barrels from the previous week’s average. US crude oil imports also fell by 477,000 barrels to register at 5.3 million barrels per day for the week ended October 9, 2020.
Even though crude oil price showed a slight recovery on the data, it was not enough to override the prevailing bearish sentiment which was brought on by OPEC’s bearish projections on crude oil demand.
Brent crude is presently trading at 42.56, or 1.98% lower.
Technical Outlook for Crude Oil Price
Today’s candle is testing the 42.50 price level, after pushing below it to test support at 41.43. We now have a small double top, most visible on the 4-hour chart with 41.43 forming the neckline.
A breakdown of this neckline targets the 39.57 support. This price level completes the measured move from the neckline—below this area, 36.40 and 33.83 form additional support targets.
On the flip side, further upside which surmounts 42.50 as well as the channel’s return line negates the pattern. This move would open the door for the price to target 44.16, with 45.39 serving as the new price target to the upside.