Recently, the global oil market has been in the strong support area, primarily because of the news about new restrictions on Russian oil supplies. Now, the market can be noted to have probably fully considered the price of this fallout in the global supply.
Several factors are still able to form a strong resistance to the growth of oil prices. Firstly, the US president-elect Donald Trump may announce debureaucratization measures during his first days in office. The measures could maximize US oil and natural gas production. Trump may also announce new energy regulations allowing faster authorization of new energy infrastructure and other energy projects. This move promised during Trump’s election campaign would fit into his broader agenda of expanding energy production. The new US administration might significantly expand oil and gas drilling opportunities.
Secondly, Trump may withdraw the US from the Paris Agreement of 2015, an international treaty to combat climate change and limit the rise in global temperature by reducing fossil fuel emissions.
Moreover, the prospect of weak demand from China, which is one of the main oil buyers, remains valid. Crude oil import to China fell in 2024 for the first time in two decades.
From the technical point of view, Brent aims to close the gap formed at the beginning of this trading week. The Brent prices are targeting the psychological level of $80.0 per barrel.
The overall recommendation is to sell Brent oil.
Profits should be taken at the level of 80.0. A Stop loss could be set at the level of 81.8.
The volume of the opened position should be set in such a way that the value of a possible loss, fixed with the help of a protective Stop loss order, is no more than 1% of your deposit funds.
This content is for informational purposes only and is not intended to be investing advice.
