Brent and WTI fell more than 2.5% on Monday. At the European trading session, the decline continued. At the time of writing, Brent was down by 3.3% and WTI was down by 3.2%.
Oil quotes are actively declining due to reports of the rapid spread in the UK of a new strain of coronavirus. The UK and EU countries have announced tougher quarantine measures, which will inevitably lead to a decrease in fuel demand. The ban on flights to the UK has already been announced in Canada, Argentina, Chile and other countries.
British Prime Minister Boris Johnson will hold a meeting on Monday to discuss the current emergency as the number of COVID-19 cases in the country soared in one day.
Industry statistics from the US also have a negative impact on the market. As oil prices rise in the US, the number of active rigs is steadily increasing as oil prices rise in the US, according to Baker Hughes data released on Friday. Now their number has reached the maximum value in the last 7 months. A further increase in production amid falling demand for fuel may increase the imbalance in the oil market.
Alexander Novak said on Saturday that global oil demand is still 6-7 million barrels per day below pre-crisis levels.
As part of the decline, the price reached an important support level of 47.40. So far, we do not see a strong reaction to this level, which increases the likelihood of its breakout. In this case, in the medium term, quotes may drop to the area of 44.80.
The main scenario is a breakdown of 47.40 and a decline in the direction of 44.80.
An alternative scenario is growth from 47.40 to 48.40.
The current fundamental outlook is negative. We consider shorts from the levels 48.00 and 48.50.
Only from April 12, 2021, to May 14, 2021, Deposit Bonus 200% is available for all FortFS clients! Use the advantage to engage for the unique offer within a limited period: activate the deposit bonus and get up to 200% on the deposit amount on your trading account! How to get a Deposit Bonus of […]
FortFS wishes all traders a Happy Chinese New Year! Only from February 8 to March 12, 2021, we reduce spreads for the 4 most popular trading pairs. New values*: EURUSDf: 0.8 GBPUSDf: 0.9 USDJPYf: 1.0 XAUUSDf: 3.5 *These values are valid only for FLEX accounts Hurry up to take advantage of the offer! Learn more about spreads: https://www.fortfs.com/clients/specifications