Crude Oil Price Forecast – Strong Day As Production Cuts May ContinueCrude oil has shot higher on Wednesday as it is reported that sources close to OPEC + have been informed that production cuts will continue into April.
WTI Crude Oil
The West Texas Intermediate Crude Oil market has rallied significantly during the trading session on Wednesday as reports are coming out of the OPEC + group that perhaps oil ministers are planning on extended production cuts through the month of April due to the idea of uncertainty after the coronavirus-induced damage to global economics. At this point, the crude oil markets are bit extended though, and I think that it would not take much to have the sellers jumping back in. I believe that $65 above is the goal, but that also looks to be the ceiling in the short term. If we were to turn around a break down below the last couple of daily candlesticks, then oil is likely to go looking towards the 50 day EMA.
Crude Oil Video 04.03.21
Brent markets also rallied during the trading session as those reports have people thinking that perhaps supply will remain tight. That being said, the longer that we stay at these high levels, the more likely we will see US shale come into the equation. After all, we have seen the Baker Hughes Oil Rig Count in the United States continue to rise over the last three months, so I think given enough time we will see more supply come onto the market in order to keep the lid on pricing. Given enough time, I do think that the sellers will come back in, but I believe that the “ceiling” is found somewhere near the $70 level as things stand right now. Furthermore, keep an eye on that statement coming out on Thursday, because of OPEC + does in fact increase production, oil will crater.
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