Crude Oil Daily Forecast – Oil Falls Below $30 as Trump Travel Ban Unnerves Investors

Crude prices continue to decline and have lost ground in the Thursday session. Currently, U.S. crude oil is trading at $31.15, down $1.94 or 5.83% on the day. Brent crude oil is trading at $32.98, down $2.82 or 7.88%. Earlier in the day, U.S. crude touched a daily low of $29. 98.

Crude Slips on WHO, U.S. Travel Ban

Crude prices have been hammered this week, falling some 23.3 percent. On Wednesday, the World Health Organization labeled the coronavirus a pandemic, which means a disease that is spreading in multiple countries around the world at the same time. Meanwhile, Italy has toughened its measures to combat the virus, announcing the closure of all shops except food shops and pharmacies. The country has already imposed severe travel restrictions on the entire population, in a desperate effort to contain the virus.

Also on Wednesday, the United Arab Emirates, OPEC’s third-largest oil producer, announced that it would follow Saudi Arabia’s lead and raise output, from 3 million to 4 million barrels per day, starting in April. On the weekend, Saudi Arabia launched an all-out price war, raising production and cutting prices after Russia refused to go along with a deep production cut.

There was more bad news for crude on Thursday, as U.S. President Trump announced a ban on foreign travelers from Europe, with the exception of the UK. The ban is in effect for 30 days and is in response to the coronavirus outbreak, which has now killed 33 people in the United States. The move has sent global stock markets sharply lower on Thursday and oil prices have followed suit.

Technical Analysis

U.S. crude has broken below support at 32.80 on Thursday. This is followed by support at 29.85. If crude crosses below this line, it has room to fall as low as the 29.00 level. On the upside, we find resistance at 35.50.