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The United States West Texas Intermediate and International-Benchmark crude oil futures were mixed last week. The US market has managed to gain a modest gain and the international market has retreated slightly downward, but Friday's price trend suggests further downward pressure.
At the start of the week, markets were able to move beyond a key technical level, reaching their highest level in four months, mainly as a result of OPEC-led supply cuts and discussions to expand the plan. reducing production and reducing the global supply. and stabilize prices. However, these gains were erased when demand concerns came to the fore on Friday.
Last week, WTI crude oil in May was established at $ 59.04, up $ 0.22 or + 0.37% and crude oil in June Brent at $ 66.75, down $ 0.29 or -0.43%.
Although buyers reached a new multi-year high, WTI and Brent crude oil stabilized at three out of five sessions. This suggests that sales may become stronger or purchases will be lower.
Basically, traders have been trapped by the demand for worries over the slowdown in the US and global economies. The Fed contributed to domestic demand concerns by reducing its growth forecasts and suggesting that the economy was not strong enough to support a further rate hike this year.
Concerns about demand were also raised when reports showed that manufacturers in Europe, Japan and the United States had suffered in March, as investigations showed that trade tensions had affected production. manufacturing.
Weekly report from the US Energy Information Administration
Crude oil prices rebounded in the middle of the week after the US Energy Information Administration announced that US crude oil inventories fell by 9.6 million barrels for the week ended March 15th. Traders were looking for a storage capacity of 1 million barrels.
Gasoline shipments also fell by 4.6 million barrels, while distillates fell by 4.1 million barrels last week, according to EIA. Traders were looking for a drop in supply of 2.1 million barrels for gasoline and distillates.
Other news
According to energy services firm Baker Hughes, US energy companies have reduced the number of drilling rigs in operation for the fifth consecutive week, bringing the lowest number in almost a year to independent producers who have implemented spending reduction plans with the government. reduce its growth forecasts for shale production.
Weekly forecasts
We have already come here. Prices continue to be supported by OPEC production cuts and US sanctions against Iran and Venezuela. In addition, concerns about demand continue to slow the recovery. However, the first demand concern was fueled by concerns over the slowdown in the Chinese economy. Friday's decision was fueled by weak European data. In addition, the Fed may have sent a message that it foresaw a slowdown in the US economy when it would have become even more accommodating by stating that it would not increase rates this year.
If demand concerns continue to grow, prices are likely to be in the near-term range. Any other report confirming the slowdown in national and global economies should continue to put downward pressure.
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