WTI Crude Oil Technical Analysis
The light sweet crude oil market is drifting a little bit lower as there is a little bit of easing of fears when it comes to an immediate Saudi supply outage. Saudi Arabia has begun offering additional crude cargoes through Oman, which has reduced some of the fear that damage to the East-West pipeline would suddenly stop a large volume of exports.
It is also getting a little bit of relief due to Energy Secretary Chris Wright in the United States suggesting the pipeline could be returned to action much more quickly than initially thought. That being said, it has driven the WTI price down to the $100 region. We still have quite a bit of noise out there.
The U.S. inventory report was a little less hawkish and less bullish than thought, as the drawdown was not as bad as once thought.
The larger backdrop, of course, remains supportive.
It is still a situation where the war headlines continue to drive a lot of concerns out there. This is more of a buy-the-dip scenario for most traders out there.
Brent Technical Analysis
The Brent markets also look like they are easing a little bit. The $100 level underneath could very well end up being an area of support. We will just have to wait and see. I will be watching it.
The fundamental backdrop, of course, is the same here. It is the same story of whether or not we get some type of disruption to supply. Brent, of course, might be a little bit more sensitive to the Middle East, all things being equal, but this is a global supply issue.
With that, it just seems to be pulling back maybe from an overbought condition. We just finally found a reason to do so.
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