Buying Oil at MAs, with Red Sea Attacks Keeping the Demand On
Crude oil has been declining for several months, since WTI failed to reach $100 per barrel and fell below $70 last week, with highs decreasing and moving averages acting as resistance signs during retraces higher. But, buyers have returned and we have seen some buying pressure for about a week, sending the price above $75.
The 20 SMA Supporting WTI Oil
WTI Oil entered the negative zone below $70, as the global economy continues to slow down. Although, there have been some positive numbers recently and we have seen some demand return in recent days as a result of Middle East tensions. Yesterday the EIA inventories posted a decent increase, but Oil ignored the numbers, following the upside momentum, as Crude Oil supply lines face a modest constraint after many corporations temporarily ceased sending Crude oil supplies through the Red Sea shipping lane following attacks on numerous vessels.
This has damaged worldwide trade in a variety of commodities, particularly crude Oil. Some corporations, like BP PLC have decided to forego using the Red Sea route for transportations. A longer route would result in commodity shipment delays and expense increases.
On Tuesday the American Petroleum Institute (API) report showed that crude Oil stocks in the United States grew by 0.93 million barrels for the week ending December 15, compared to a 2.34 million barrel reduction the previous week. So, expectations were for an increase indeed.
EIA (Energy Information Administration) Weekly US Oil Inventories:
- Overall Inventories: +2,909K barrels
- Expected: -2,283K barrels
- Previous: -4,259K barrels
- Crude Inventories: +2,909K barrels
- Expected: -2,283K barrels
- Gasoline Inventories: +2,710K barrels
- Expected: +1,233K barrels
- Distillates Inventories: +1,485K barrels
- Expected: +469K barrels
- Refinery Utilization:2%
- Expected: +0.2%
- Production:3 million barrels per day (mbpd)
- Previous: 13.1 mbpd
- Implied Motor Gasoline (mogas) Demand: 875 mbpd
- Previous: 8.86 mbpd
API (American Petroleum Institute) Private Inventories:
- Crude Inventories: +939K barrels
- Gasoline Inventories: +669K barrels
- Distillates Inventories: +2,738K barrels
U WTI Crude Oil
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