Increasing oil production direction is spreading very rapidly in the market nowadays. In response to that US places Independent refineries from China on the sanction list, Chinese oil refineries continue importing large quantities of crude oil in April. Imports totalled 11.7 million barrels per day, according to data from the customs authority.
Although this was less than the previous month, it was 7.5% more than the previous year. The only advantage will be from the significant drop in oil prices.
Also, Kazakhstan continues to produce more oil than agreed, and it seems that there is no plan to reduce production in May.These approaches could lead Saudi Arabia to increase oil production in July, which will strengthen the downside risks for oil prices.
Technical Levels for Crude Oil Prices:
Today, the Crude oil finds a ground and a good support at $60.85, and successfully goes up to reach the 63.48, so if the price can break out the Bollinger band resistance of $64.21, it may go up to the second resistance at $ 64.99.
On the bearish side, any daily clear close under $62.30 will lead to a significant downtrend to reach even lower levels.
Factors Affecting Brent Oil Prices Nowadays:
Geopolitical Tensions:
The ongoing US-China trade discussions can significantly affect the oil prices, while any signs of easing or escalating tensions can move prices.
Supply and Demand: OPEC+ Production decisions:
It’s crucial for oil prices as when the OPEC+ decides to increase production, this leads to a move in prices down and vice versa. Also, reports on crude oil inventories can influence the prices, because increases mean higher supply and decreases mean higher demand.
Global Economic Growth:
This is a fundamental driver of oil demand, as long as the global economic growth remains downward, the oil prices can be under pressure. In conclusion, the current price for Brent oil is under pressure due to the factors mentioned above, and the bearish direction is still recommended.
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