Chicago WTI Crude oil futures price is up 0.70% at $102.44 per barrel on early Wednesday trades. Oil prices were steady on Wednesday after Russia halted gas supplies to Bulgaria and Poland, although concerns about China’s COVID lockdowns weighing on economic growth and oil demand kept a lid on oil prices.
On Monday, both the benchmarks – Brent and WTI crude oil dropped around 4% on concerns over reduced demand in China, the world’s largest crude oil importer. Tuesday’s crude oil session was volatile as the market weighed China’s plan to support its economy against a possible COVID-induced lockdown in its capital city. The Chinese central bank announced on Tuesday that it will step up to support its national economic growth. However, with the increasing possibility of lockdown in Beijing, it is not clear to what extent will the central bank be able to foster economic growth.
The European Union (EU) continued to consider options to cut Russian energy imports as a part of possible future sanctions. While the short-term supply void can be satisfied by releases from strategic reserves, long-term substitutes will be difficult to find as the OPEC + member countries failed to meet their production cap. Meanwhile, Kazakhstan has ramped up its crude production after having to curtail it due to a bottleneck on its major exports pipeline.
On the technical side, the RSI of Chicago WTI crude oil futures stood at 50.07 and is currently trading above MA (5) and MA (20) but below MA (50). So, BUY position can be taken with the following target and stop-loss: