Crude oil price continues lower for one more day as the global sell-off intensifies amid the coronavirus spread around the globe. The price hovers at four years low amid weak global demand and an escalation in the price war between Russia and Saudi Arabia. The United Arab Emirates followed Saudi Arabia, announcing a raise oil output to a record high in April.
President Trump’s announcement yesterday that will ban all flights from Europe just added to travel restrictions across the globe and to reduce further the demand for oil. The situation in transportation and travelling is getting nasty around the world as more and more countries are closing the borders and airlines are cancelling flights across the globe. OPEC and IEA have slashed the demand expectations, with demand growth expected to be flat or negative for the rest of the year.
The crude oil price is 6.12% lower at $30.95 as the technical outlook is clearly bearish for black gold. Crude oil price is in an oversold level, so a sharp rebound can’t be ruled out, but it will be just a reaction, not a trend reversal.
On the downside, the first support level to watch is the daily low at $30.02. Next critical support zone for crude oil price stands at 27.74 the low from March 9th and the four-year lows.
On the upside, oil price first resistance stands at $33.63 the daily top. If the crude oil price breaks above, the next hurdle will be met at $36.87 the high from March 11th trading session. The next supply zone will be met at 41.32 the low from March 6th trading session, which will also close the recent gap down.