WTI TARGETING 62 LEVEL, AS IRAN EXEMPTIONS CREATE DEMAND CONCERNS
WTI Crude futures are currently trading at $62.64-lower by 0.42% as compared to the previous closing. Crude prices declined on Tuesday after Washington granted sanctions exemptions to top buyers of Iranian oil, lifting supply concerns and turning the market’s focus to worries that an economic slowdown may curb fuel demand.
Brent crude futures were trading at $72.46-lower by 0.35% at the time of writing.
Washington gave 180-day exemptions to eight importers – China, Japan, India, South Korea, Italy, Greece, Taiwan, and Turkey. This group takes as much as three-quarters of Iran’s seaborne oil exports, trade data shows, meaning Iran will still be allowed to export some oil for now.
Iran’s crude exports could fall to little more than 1 million barrels per day in November, roughly a third of their mid-2018 peak. But the Markets expect that the figure could rise from December as importers use their waivers.
The US on Monday restored sanctions targeting Iran’s oil, banking and transport sectors and threatened more action to stop what Washington called its “outlaw” policies, steps Tehran called economic warfare and vowed to defy.
On the supply side, oil is ample despite the sanctions against Iran as output from the world’s top three producers – Russia, the US and Saudi Arabia – is rising. The three countries combined produced more than 33 million bpd for the first time in October. It means they alone meet more than a third of the world’s almost 100 million bpd of crude oil consumption.
In a related report that is published by the API every week, the API is scheduled to report U.S. crude supplies for the week ended 2nd Nov., today at 4:30 pm ET. The API is expected to report a rise of 4.1 million barrels in US crude supplies. Previously, the API reported that U.S. crude supplies rose by 5.7 million barrels for the week ended Oct. 26.
The EIA will report US crude inventories for the week ended 2nd Nov. on Wednesday. The market expects that the EIA will report a 2 M barrel rise in US crude inventories for the week. Previously, the EIA reported that U.S. crude inventories rose by 3.217 million barrels for the week ended Oct. 26.
On the technical front, the RSI is currently at 24.71% and suggests that the market can move in the downward direction. The current price is below the MA5. The current Price is below the middle line of the Bollinger bands and is heading downwards.
Overall Bias is Negative and short-term trades can be initiated with tight Stop Loss and Profit targets.
Trade Suggestion-Limit Sell At 62.75, Take Profit At 62.05 Stop Loss At 63.10