Daily basic oil price forecasts – weaker as fears of recession raise concerns over demand

Brent crude futures are trading lower on Monday, but inside Friday's range, stock prices suggest investor indecision and imminent volatility. The current 1% drop in prices is driven by the fact that an impending global recession could offset the current tightening of supply fueled by a combination of OPEC-led production cuts and US sanctions against US Iran and Venezuela.

At 7:39 GMT, the May WTI crude oil futures trade at $ 58.64, down $ 0.40 or -0.66%, and the Brent Brut price at $ 66.37, in down 0.38 USD or -0.57%.

Fears over a possible recession in the US began to surface last week after the Federal Reserve reduced its growth prospects, while stating that it would not increase rates of inflation. Interest this year due to a weakening of the economy.

Concerns rose on Friday, when 10-year US Treasury yields fell below the three-month rate for the first time since 2007. Historical data indicates that, when a yield curve is reversed or the rates long-term are lower than short-term rates, reported a future recession.

Fears of a recession added the reports of widespread weakness on a global scale. On Friday, manufacturing data from Germany, Europe's largest economy, fell for the third consecutive month. In addition, the weakness of manufacturing is also apparent in China and Japan.

As the ANZ bank says, the darkening economic outlook "overshadowed supply-side problems".

Daily forecasts

Prices should continue to be supported by OPEC-led supply cuts and sanctions against Iran and Venezuela. However, the inability to sustain a recovery from current levels of technical resilience after markets hit their four-month high last week, suggests long traders take profits at current price levels. In addition, investors are struggling to buy their strength in this market, suggesting that prices may have to fall back into a value zone to attract new buyers.

Recent price developments clearly indicate that WTI futures traders have clearly established resistance between $ 59.63 and $ 60.39. If sales pressure persists, the nearest short-term target is 57.37 USD to 56.78 USD. Buyers could pause in this area.

Brent futures traders put resistance between $ 67.90 and $ 68.45. Its first downside target area is $ 66.33 to $ 65.70. This area is being tested. In case of failure, prices should drop between $ 64.03 and $ 62.99.