Oil continues to trade in a narrow range after the OPEC+ announcement of production cuts. The uncertainty of further movement remains. However, encouraging news on demand keeps coming to the market.
The negative for oil is a potential recession in the U.S., which has been hinted at through a weakening labor market. This factor will put pressure on oil in the longer term.
Demand from India will be high this year, as the heat season and increased energy consumption are expected.
According to preliminary data from the Indian government, the refining level in the country is still rather high. In February, refinery throughputs increased by 2% year-on-year to 5.46 million barrels per day (20.85 million tons). In January, it was 5.39 million barrels per day (22.80 million tons).
India’s fuel demand hit the highest level over the past 24 years in February. Oil refining volumes that month were the highest since 2009.
The main OPEC+ member confirms strong oil demand.
May oil prices for Asian buyers were increased by Saudi Arabia.
State-owned Saudi Aramco announced a rise in prices for its flagship arabic light by 30 cents in Asia, the seller increasing prices in the region for three consecutive months. More than half of Saudi Aramco's fresh crude exports from storage facilities is transported to Asia, mostly under long-term agreements with prices adjusted each month.
The largest oil consumers are China, India, South Korea and Japan.
According to the technical analysis, as written earlier, oil is in the narrow range. It might be suggested that oil removes overbought before a new attempt to grow. Now the prices are closer to the lower boundary of the rectangle. Long-growth positions to the upper boundary of the figure.
The growth target will be the level of $85.7. Stop-loss will be set when moving below the current consolidation near the price of $83.8.
Brent oil is likely to rise:
Take profit – 85.7
Stop-loss – 83.8