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WTI Oil Rallies Amid Rising Tensions In Iraq

By:
Vladimir Zernov
Published: Aug 29, 2022, 15:30 UTC

Copper retreated towards the $3.60 level amid worries about the slowdown of the global economy. Gold rebounded from session lows as U.S. dollar pulled back from yearly highs.

WTI Oil

In this article:

Key Insights

  • Oil markets rally as protesters storm the Republican Palace in Iraq. 
  • Copper markets suffer a sell-off on recession worries. 
  • Natural gas markets decline as Germany’s storage facilities are filling up faster than expected. 

WTI Oil Tests The $96 Level

WTI oil moved above the $96 level as traders focused on protests in Iraq. The protests were triggered by Shi’ite Muslim cleric Moqtada al-Sadr, who said that we would quit politics. Protesters have already stormed Iraq’s Republican Palace.

Traders have shifted their focus from recession worries to supply issues in recent trading sessions. The news from Iraq provided significant support to oil markets, and traders will likely stay focused on the developments in the country in the upcoming trading sessions.

WTI Oil
WTI oil is currently testing the $96 level. In case this test is successful, WTI oil will move towards the 50 EMA near the $98 level. A move above the 50 EMA will open the way to the test of the psychologically important $100 level.

On the support side, the nearest significant support level for WTI oil is located at the 20 EMA at $93.75. If WTI oil declines below the 20 EMA, it will head towards the next support at $93. A successful test of the support at $93 will push WTI oil towards the next support level at $91.75.

Copper Retreats As Traders Focus On Recession Risks

Copper moved towards the $3.60 level as traders focused on risks for global economic growth. Copper markets remained strong in recent trading sessions, but it looks that Powell’s speech provided enough catalysts for the bears.

Copper prices have been consolidating in the $3.60 – $3.70 range for half a month, and a move below this range may trigger a sell-off.

Gold Is Mostly Flat As U.S. Dollar Pulls Back From Yearly Highs

Gold has recently managed to get back to the $1740 level as the U.S. dollar moved away from yearly highs. Treasury yields are moving higher, which is bearish for gold. However, the pullback in the U.S. dollar provided some support to precious metals.

Silver continues to trade below the $19.00 level, although it managed to rebound from the recent lows near $18.50. Platinum is trading near the $850 level, while palladium is stuck at $2100.

Natural Gas Markets Pull Back At The Start Of The Week

Natural gas prices have pulled back below the $9.50 level as European natural gas markets retreated from recent highs. In Europe, traders reacted to the comments of Germany’s Economy Minister Robert Habeck, who said that country’s natural gas storage facilities were filling up faster than planned.

European natural gas markets will remain in focus in the upcoming days as Russia’s Gazprom will cut supplies via Nord Stream 1 for three days, starting from August 31. The key question is whether the pipeline will work again after the scheduled maintenance.

In the U.S., markets will remain sensitive to the developments in European natural gas markets while traders wait for the EIA report, which will be released on Thursday.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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