Crude oil price

Crude Oil Price: Short Term Correction Looks Likely

Crude oil price on the Brent and WTI benchmarks are easing from the pandemic highs attained earlier today, after the weekend attacks by Yemen’s Houthi rebels that targeted Saudi Arabia’s oil sites. 

The attacks prompted a knee-jerk response in crude oil prices, with the Brent crude benchmark hitting a high of $71.38 in Asian trades, marking 14-month highs. However, prices are now down on the day by 0.49% as the markets cool off. Despite the intraday drop, crude oil prices remain just below the highest levels attained previously on Friday at $69.20, keeping prices close to the $70 mark. 

This is not the first time that Saudi Arabia’s oil facilities have been attacked by Houthi rebels. A previous attack in 2019 damaged crucial facilities of national oil company Saudi Aramco, with crude oil prices responding similarly as was seen this morning. 

Crude oil prices had been on the upside following the decision of the OPEC + alliance and Saudi Arabia to maintain the production curbs that were to end in March. 

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Technical Levels to Watch

The active daily candle has formed a shooting star just below the 70.01 resistance line. This sets up the potential of a short-term correction on the Brent crude asset. If the candle closes out this way, then we could see a corrective wave that targets the 67.74 support initially. Below this level, 66.81 and 65.95 come into the picture as additional targets to the south. 

On the flip side, a price advance above 70.01 brings today’s intraday high into the picture as the next resistance target. Above this level, 73.34 (15 May 2019 high) and 75.52 (31 July 2018 and 15 April 2019 highs) become the new upside targets, marking two-year highs. 

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Brent Crude; Daily Chart

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