Crude Oil: WTI Hits Three-Month Highs Above $120
2022.06.09 09:51
WTI crude oil reached its highest level in three months above $123, up 2.3% on Wednesday following the release of crude oil inventories data by the Energy Information Administration. Brent rose past $124 per barrel with a gain of 2.5% on the day.
On the supply side, EIA data showed that U.S. crude inventories fell 2 million barrels in the week ending Jun. 3, while gasoline inventories fell by 800,000 barrels and inventories of distillates increased by 2.6 million barrels.
At the same time, prices were supported by the potential for a strike by Norwegian offshore oil workers next week, which could cause output shortages from the largest producer in Western Europe outside Russia.
Both WTI and Brent have risen more than 30% since the Russian invasion of Ukraine on Feb. 24, adding to inflationary pressures in major economies.
On the demand side, the relaxation of Covid-related policies in China is another bullish factor for the crude prices, as it means higher demand from the world’s largest importer.
WTI Daily Chart.
The short-term technical outlook for WTI remains bullish, according to the daily chart, after the price broke above the $120.00 threshold.
The RSI has accelerated higher in convergence with the price and is close to overbought territory, while the MACD has printed a new green candle and continues to gain momentum.
To the upside, the next resistance level is seen at $125.00, followed by the Mar. 8 high at $129. On the other hand, immediate support is seen at the $120.00 level, followed by the 20-day SMA at $114.00 and then the $112.50 area.
