More Strength Lies Ahead For Brent
2022.04.15 15:06
Crude oil has moved up since Apr. 23 as focus on tight supply continues and despite a large build in American stocks driven by the release of reserves. The Secretary General of OPEC Mohammad Barkindo categorically denied that the cartel would pump more oil in response to possible energy sanctions by the EU on Russia.
Tuesday’s statement from OPEC was quite unusual; it’s rare to see the group being so blunt in response to feelers from major consumers. Equally, the American release of reserves of crude is likely to provide only a temporary respite. Although 546 active rigs last week was a two-year record, it’s going to take probably a long time before we see a clear jump in production from the USA.
Brent price chart.
The descending triangle on the daily chart would suggest a declining range before a breakout around Apr. 25. However, as of Thursday, it seemed unlikely that this pattern will hold, with a more favorable move up in the next few days.
Volume remains high and the price moved out of oversold after a strong response to testing of the 50 SMA. The obvious near-term target would be the round number of $110, with March 24’s high around $118.50 perhaps appearing after that.
