Global Oil Prices Show Signs of Recovery Amidst Supply and Demand Concerns

Global Oil Prices Show Signs of Recovery Amidst Supply and Demand Concerns

VoM News Desk | November 17, 2023 | 11:08 PM IST | Energy | Follow on Google News

Global Oil Prices Show Signs of Recovery Amidst Supply and Demand Concerns

Global Oil Prices Show Signs of Recovery Amidst Supply and Demand Concerns

Global oil benchmarks are heading towards their fourth consecutive weekly loss on November 17, though they have slightly recovered from the previous day’s steep decline, influenced by concerns about rising supply and cooling demand.

Recent Trends in Oil Prices

• Brent Futures: Increased by about 1.7% to $78.76 a barrel.
• West Texas Intermediate (WTI) Crude: Rose roughly 1.7% to $74.1.
• Overall Losses: Both benchmarks have lost about a sixth of their value over the past four weeks, marking a fourth straight week of losses.

Crude Oil Futures in India

On the Multi Commodity Exchange (MCX), crude oil futures for November 17 were trading higher by 3.75% at ₹6,252 per barrel, fluctuating between ₹6,070 and ₹6,261 during the session.

Factors Impacting Crude Oil Prices

• US Crude Inventories and Production: A significant rise in US crude inventories and sustained high production levels.
• Demand Concerns in China: Indications of weakening demand in China.
• OPEC+ Response: Expectations of OPEC+ extending voluntary cuts into 2024, with Brent falling below $80 a barrel.
• US Economic Data: Increase in US unemployment claims and a contraction in industrial production.
• Saudi Arabia’s Stance: Potential extension of Saudi Arabia’s voluntary supply cuts into 2024.
• US Production Forecast: The US is expected to boost production to a new annual high, according to the IEA.
• Middle East Tensions and US Sanctions: Escalating tensions in the Middle East and US sanctions against Iran.

Future Price Predictions

Analysts predict ongoing volatility in crude oil prices, with WTI experiencing a decrease exceeding 14% in the past month. OPEC+ and IEA’s positive adjustments in global oil demand forecasts could support prices at these lower levels. Anticipated support and resistance levels for crude oil in the USD range are $72.30–71.50 and $73.90-74.50, respectively. In INR, support is at ₹5,940-5,850, with resistance at ₹6,135-6,190.

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