Oil price: Manufacturers, the United States again reminded the market about its power
Yesterday was extremely unfortunate for the oil market, with February Brent closed in negative territory for the first time after seven consecutive monthly increases. The main factor of pressure on the quotes is the high activity of producers in the shale deposits of the United States, which eliminates all of the verbal intervention of the OPEC countries, signaling its readiness to further cooperation after the expiration of the agreement.
On the eve of the U.S. Department of energy has published the latest weekly report. Reserves of crude oil increased by 3 million barrels, above the forecast and assessment API. Gasoline inventories rose 2.5 million barrels. Production increased by 13 thousand barrels per day to 10.28 million barrels per day – new record-after a slight dip a week earlier. Apparently, many market participants were hoping for production cuts, though again symbolic, but slantseviki once again reminded of his power, sending the barrel into free fall.
During the collapse of Brent crude broke through the psychological level of two, once on weekly lows around 64,50. In the absence of significant factors in the commodity segment, the players focused on the strengthening of the dollar and further growth in the oil industry in the US that created conditions for more aggressive liquidation of long positions.
If the us currency does not lose the initiative and will receive a fresh stimulus to the growth on the publication of data from States and today’s speech of Powell’s, the barrel will continue bearish move with the immediate goal at the level of 64.30, the breakout of which will open the way towards the next psychological barrier 64.
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