Crude oil is settling at $76.57 per barrel, up $2.65 or 3.56%. The price reached a 3- month high today.
New U.S. sanctions targeting Russia’s oil exports helped to contribute to the rise. The Biden administration imposed sanctions on Russian oil producers Gazprom Neft and Surgutneftegas, their subsidiaries, over 180 vessels, oil traders, oilfield service providers, and energy officials to curb Russia’s revenue used to fund the war in Ukraine. Treasury Secretary Janet Yellen emphasized the move as a significant escalation in sanctions on Russia’s oil trade.
The sanctions, coupled with OPEC+ production cuts, high winter demand, and supply disruptions, could tighten global oil markets further.
Additionally, a major Chinese port’s ban on sanctioned tankers from Russia and Iran could drive China to seek alternative crude sources, adding pressure to global supply chains.
Technically, the price moved above the 200 day MA at $75.14. That was the first break of the key MA since October 8, when the price broke above, but closed back below the MA level turning buyers back to sellers. Today, the price is cloing comfortably above the MA. However, a move back below would disappoint the buyers once again.
On the topside, the price moved up to test a trend line at $77.56. The high price reached $77.80 but rotated back lower. The 50% midpoint of the range for 2024 comes in at $76.44. The price is closing just above that level (bullish).
Buyers are more in control.
This article was written by Greg Michalowski at www.forexlive.com.
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