WTI Crude Rises Above $79 with Rate Cut Hopes
On Friday, WTI crude futures strengthened beyond $79 per barrel, poised to conclude the week with upward momentum. This was supported by recent drops in US crude oil reserves and a growing belief that the US Federal Reserve would reduce interest rates within the year. According to EIA data, US crude stockpiles declined by 2.508 million barrels last week, marking the second consecutive weekly decrease and surpassing expectations of a 1.362 million barrel reduction. Additionally, April figures indicated a slowdown in US consumer inflation, heightening expectations of a Fed rate cut that could stimulate economic growth and fuel demand. However, the International Energy Agency revised its global demand growth forecast for the year by 140,000 barrels per day to 1.1 million. In other developments, the latest OPEC report revealed that member nations exceeded their production limit by 568,000 barrels per day in April. Nevertheless, OPEC maintained strong demand projections of 2.25 million barrels per day in 2024 and 1.85 million barrels per day in 2025.
In oil, which has seen three consecutive days of gains, the first resistance level in continuation of the upward movement will be the 200-day moving average at 80.10. Above this level, the subsequent levels to watch are 81.10 and 82.00, respectively. On the downside, the initial level to monitor is 79.20. A breach of this level would open the way for 78.20 and 77.60, respectively.
Resistance 3 | Resistance 2 | Resistance 1 | Support 1 | Support 2 | Support 3 |
82.00 | 81.10 | 80.10 | 79.20 | 78.20 | 77.60 |