2023-05-12 21:57:03
US oil prices fell near the level of $70 per barrel, marking a decline for the fourth week in a row, with continued market concerns regarding demand growth rates.
For a short while, it seemed that WTI might be able to break the losing streak, supported by signs that Iraq’s oil exports may not resume on Saturday, and the US hinting that it might buy crude to replenish strategic reserves following next June.
However, the dollar’s rise on Friday, which raises oil prices for those who buy in other currencies, erased those gains.
Throughout the week, oil was pressured by the physical over-the-counter market which showed signs of weakness amid lower margins on refining activity and slower buying in some areas.
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The world’s two largest economies showed additional signs of slowing, with US jobless claims rising and China’s recovery slowing. Cash fund managers invested in bearish bets on Brent Crude, which sent net long positions to their lowest since December.
“Near-term oil futures trading is dominated by bears, and will continue to do so at least until we see positive signs,” said Dennis Kessler, senior vice president of trading at BOK Financial Securities. essential on the demand side.
pessimistic sentiment
Crude Oil fell by around 15% over the past month as a pessimistic sentiment dominated the market. Investors are expecting the US economy to be close to recession, and some market watchers have been disappointed in China’s recovery, putting a question mark on energy demand. On Friday, Citigroup cut its forecast for Brent crude from $84 a barrel to an average of around $82 a barrel this year, as demand continues to fall short of expectations.
So far, the impact of this has outweighed that of the production cuts announced by the Organization of the Petroleum Exporting Countries (OPEC) and its allies. However, another production cut may not be on the table for now, Archyde.com reported, citing an interview with Hayan Abdul Ghani, Iraq’s oil minister.
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Investors in the market said that prices encountered technical support near $70 and $75 per barrel so far, but a decline below these levels may lead to a rapid decline in oil by regarding $10.
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