Crude oil price continues to face a key hurdle in the form of unsteady recovery in global oil demand. The rising COVID-19 cases are of the drivers of the decline. India, the third-largest crude oil importer in the world, has continued to record a surge in new infections. According to Johns Hopkins University, the number of coronavirus infections in the country has exceeded 15 million. Subsequently, India capital, New Delhi is on a weeklong lockdown.
Japan, the fourth-largest crude oil importer, has also seen its cases rise beyond 142.5 million. Subsequently, it is eyeing a state of emergency for Osaka and Tokyo.
Crude oil price is also reacting to the rise in US stockpiles. On Tuesday, API indicated that the weekly oil inventories had risen by 0.436 million barrels compared to the expected decline of 2.860 million barrels. Investors are now keen on whether today’s EIA’s data will echo the trend.
Crude Oil Price Technical Outlook
Crude oil price is trading lower as the market reacts to the rising COVID-19 cases and rise in US inventories. On an hourly chart, WTI futures are below the 25 and 50-day exponential moving averages. Besides, it has formed a bearish pennant. Based on these indicators, the outlook is rather bearish.
At the time of writing, the benchmark for US oil was down by 0.54% at 62.05. If EIA confirms the trend indicated by API, crude oil price is likely to decline further to find support at 61.50. below that level, the bears will be targeting the psychological 60.
On the flip side, the price could rebound to 62.50, where it will find some resistance before moving higher to target $63.
Crude Oil Price Chart
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