Crude Oil Price Update – Holding Earlier Gains after Saudis Raise Official Selling Price

U.S. West Texas Intermediate crude oil futures are trading higher on Monday, but giving back some of its earlier gains. The market jumped on the opening after Saudi Arabia raised prices for its crude sales in July.

Traders said the move served as a sign of tightening supply even after OPEC and its allies agreed to accelerate output increases over the next two months.

At 09:00 GMT, July WTI crude oil futures are at $119.13, up $0.26 or +0.22%. On Friday, the United States Oil Fund ETF (USO) settled at $89.45, up $2.20 or +2.52%.

Saudi’s Raise July Official Selling Price

Saudi Arabia raised the July official selling price (OSP) for its flagship Arab light crude to Asia by $2.10 from June to $6.50 premium versus the average of the Oman and Dubai benchmarks, state oil producer Aramco said on Sunday and Reuters reported.

The July OSP is now at its highest level since May, when prices hit all-time highs due to worries of disruption in supplies from Russia because of sanctions over its invasion of Ukraine.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the March 7 top at $121.17 will reaffirm the uptrend.

A move through $103.24 will change the main trend to down. This is highly unlikely, but since the market is up 11 sessions from its last main bottom, it is currently inside the window of time for a closing price reversal top.

The minor trend is also up. A trade through $111.20 will change the minor trend to down. This will shift momentum to the downside.

The nearest support is a pair of 50% levels at $116.10 and $114.80, followed by a third pivot level at $112.12.

Daily Swing Chart Technical Forecast

Trader reaction to $118.87 is likely to determine the direction of the July WTI crude oil market into the close on Monday.

Bullish Scenario

A sustained move over $118.87 will indicate the presence of buyers. If this is able to generate enough upside momentum then look for a surge into the first target price at $121.17.

Sellers could come in on the first test of $121.17. However, overcoming this level could trigger an acceleration into the next target at $126.42.

Bearish Scenario

A sustained move under $118.87 will signal the presence of sellers. The first downside target is $116.10, followed by $114.80.

A failure to hold $114.80 will indicate the selling pressure is getting stronger with the next target $112.12, followed by the minor bottom at $111.20. The latter is a potential trigger point for an acceleration to the downside.