WTI Crude Oil Trading at $75.08 Amid Middle East Tensions and Falling US Inventories

WTI Crude Oil is trading at $75.08. The 4-hour chart highlights a pivotal point at $75.65. Immediate resistance levels are found at $75.65, $77.00, and $78.12, while immediate support levels are at $73.93, $72.78, and $71.64.

The 50-day Exponential Moving Average (EMA) is positioned at $75.31, reinforcing the resistance at the current price level.

Given the downward trendline extending resistance, a sell recommendation is advised below $75.

Monitoring these key levels and the 50 EMA is crucial for short-term trading strategies.

Oil Prices Impacted by Middle East Tensions

On Thursday, oil prices experienced volatility and appeared likely to break a two-session streak where they gained approximately 3%.

This movement is attributed to growing supply risks amid tensions in the Middle East.

The killing of senior members of Hamas and Hezbollah has raised the possibility of retaliatory strikes by Iran against Israel, adding to market uncertainty.

However, despite these tensions, actual supply disruptions have not yet occurred. Attacks on ships in the Red Sea have caused tankers to take longer routes, adding to logistical concerns.

Oil prices fall, set to snap two-session streak https://t.co/78nb3DSVU3

— Energy Services (@_EnergyServices) August 8, 2024

US Crude Inventories and Market Demand

Crude inventories in the United States, the world’s largest oil consumer, fell by 3.7 million barrels, far exceeding analyst expectations of a 700,000-barrel draw.

This marks the sixth consecutive weekly decline, bringing inventories to six-month lows.

“This suggests demand for physical barrels remains robust, despite concerns about weak economic activity,” ANZ analysts noted. The data reflects a strong underlying demand that continues to support WTI Crude Oil prices.

Global Geopolitical Risks and Price Forecast

Libya’s National Oil Corporation declared force majeure at its Sharara oilfield due to protests, gradually reducing production.

ANZ Research highlighted that the market remains on edge, anticipating Iran’s response to recent geopolitical events.

Analysts at Citi indicated the possibility of WTI Crude Oil prices bouncing to the low-to-mid-$80s range for Brent.

They cited tight market balances, heightened geopolitical risks across North Africa and the Middle East, potential weather-related disruptions, and light-managed money positioning as key factors influencing the USOIL price forecast.

Hamas's recent promotion of the leader behind the Oct. 7 attacks in Gaza raises concerns about escalating tensions in the region. Geopolitical risks like this can potentially impact global markets and investor sentiment. #Hamas #Gaza #geopolitics #investing

— Ayrton Nacer (@ayrton_nacer) August 7, 2024

In conclusion, the WTI Crude Oil price forecast suggests careful monitoring of geopolitical developments and inventory levels, with current conditions favouring a cautious approach to trading.

WTI Crude Oil Price Forecast – Technical Outlook

WTI Crude Oil is currently trading at $75.08. The 4-hour chart highlights a pivotal point at $75.65.

Immediate resistance levels are found at $75.65, $77.00, and $78.12.

On the downside, immediate support is at $73.93, followed by $72.78 and $71.64.

The 50-day Exponential Moving Average (EMA) is positioned at $75.31, which reinforces the resistance at the current price level. Given the downward trendline extending resistance, it is advisable to sell below $75.