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Due to the weight of global stories, crude oil prices are still holding to recent highs. Hopes for a Gaza ceasefire are still alive, but emotions are still high.
The OPEC production limitations are mitigated by the ongoing increase in US crude oil production. As a possible truce in the Gaza Strip remains elusive, WTI Crude Oil continued to approach $77.00 per barrel on Monday, with barrel bids pushing towards recent highs. The American crude oil is trading at $76.79 per barrel at the time of writing; up +040%.
US crude oil has been rising for five days in a row as a result of geopolitical news, pushing WTI up almost 6% last week. Energy markets are holding prices high as we approach the new week, but it’s becoming more and more difficult for investors to focus on anything other than the US’s record-breaking crude oil production.
Last week, Israel turned down an immediate cease-fire agreement, which kept the price of crude oil high. However, talks are still going on as major countries attempt to contain any possible fallout from geopolitical dangers.
Monday saw the announcement of Saudi Energy Minister, Abdulaziz bin Salman Al Saud, that OPEC is still ready and able to modify its policies as necessary.
In recent months, OPEC has had to battle an uphill battle as US crude oil output has continued to rise to record highs, solidifying the US’s position as the world’s top producer of crude oil and wiping out OPEC production limitations.
Even though some production facilities were temporarily closed due to cold weather snaps, US oil production reached a familiar peak in January. The US pumping output reached its highest point since November of last year.
WTI is still positive technically, but it is capped above $77.00, the crucial level. WTI is still up more than 7% from the lowest bids of the previous week, around $71.50, but it is not gaining the bullish momentum that would drive barrel bids back up to the peak of January, around $79.00.
US Crude Oil is stuck close to well-known technical highs as WTI keeps trading into the 200-day Simple Moving Average (SMA) at $77.30. This is the result of five straight days of WTI advances. A consolidation zone between the 200-day and 50-day SMAs, at $73.25, is where Crude Oil is stuck as the long-term median 200-day SMA is stifling bullish momentum.
