Crude oil prices retreated today after the spike yesterday giving up 0.68% at $55.59 per barrel after the EIA weekly report noted a 1.699 mb decline in US crude oil stocks missing expectations of an increase of 2.8 mn bbl. The drop in crude stocks came from steady production, rise in refinery usage, higher exports and lower imports. US crude production was steady at record level of 12.6 mb per day. Reports indicating that OPEC+ producers might consider production cuts in their next meeting in December. IMF lowered its full-year growth forecasts for the Asian region to 5% from 5.4% projection made in April. The global economy’s growth rate expected to 3% down from 3.2% in a July forecast.
Oil investors focus on crude fundamentals and ignore the new point of geopolitical tensions in the East. Many analysts expect crude oil to remain under pressure in the short term due to weak global demand on the back of recession fears, US-China trade tensions and a stronger USD.
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Crude Oil Resistance and Support
Crude oil yesterddday manage to break above the recent trading range between $52 and $55 as the momentum turns neutral for crude oil price, and trades above the 50-day moving average.
On the upside, crude oil immediate resistance level stands at the daily high at $55.94, while more offers could emerge at $57.06 the 200-day moving average. Next barrier is the $58.50 mark the high from September 24th. On the flip side, immediate support stands at daily low of $55.41, then at $55.34 the 50-day moving average followed by yesterday lows at $53.71. If the price today closes convincingly above the 100-day moving average, it will pave the way for a move higher to $57 zone.