WTI: investors follow the development of Hurricane Laura
Today, the oil market is constrained in a narrow range, with potential for further growth amid a decline in production in the Gulf of Mexico and positive EIA data on reserves.
Investors are closely monitoring Hurricane Laura, which reached power level 4 on a 5-point scale on Wednesday. The US National Hurricane Center has warned that the storm will bring heavy rains and winds up to 150 mph.
Due to the potential worsening weather conditions in the region, not only oil production platforms were mothballed, but also oil refineries, which account for up to 15% of the US refining capacity, were shut down. Refining capacity is about 2.9 million barrels per day.
According to the EIA report for the week, the level of oil reserves in the United States fell by 4.7 million barrels per day, against the forecast of -3.7 million barrels. Oil reserves in the country have been declining for the 5th week in a row, having a positive impact on the dynamics of oil prices. Previously, many investors expected stock levels to rise amid the spread of COVID-19 in the United States.
The upward movement continues to develop on the chart. Buyers keep the price above 43.20. We are waiting for the breakdown of resistance at 43.75 and the growth of quotations above 44.00.
The main scenario - a breakdown of resistance at 43.75 and further growth.
An alternative scenario - a breakdown of support at 43.20 and a decline to 42.50.
The current fundamental outlook is moderately positive. We consider longs from the levels of 43.20 and 42.50.
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