Oil Prices Waver as US Inventory Surges

Oil prices have faced upward constraints due to increasing demand concerns, following an unexpected report from the United States Energy Information Administration (EIA). For the week ending June 21, the EIA reported a significant increase in oil inventories, totaling 3.59 million barrels, contrary to economists' expectations of a 3.0 million barrel drawdown from the previous figure of 2.55 million barrels. This development has intensified worries about oil consumption in the world’s largest economy.

Investor concerns are also heightened by the maintenance of a restrictive interest rate policy by the Federal Reserve, which could extend for a longer period. This policy has worsened the household financial crisis, leading to dimmer demand prospects for oil. Additionally, the downside in oil prices is still seen as likely with fears that tensions in the Middle East could escalate from Gaza to Lebanon.

Prices have fluctuated within a narrow range, with immediate resistance observed at $79.15 and potentially higher levels at $80.00 and $81.00. On the downside, the first support level is at $78.30, with subsequent levels at $77.65 and $76.90 if breached.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
81.00	80.00	79.15	78.30	77.65	76.90