Brent crude prices fall amid supply glut and dollar weakness

Brent crude prices have declined in recent days, falling to $64.04 per barrel. This movement reflects growing market pressure from expectations of increased OPEC+ production. The group is considering raising output by 411.000 barrels per day in July, fueling oversupply concerns.

The market situation is further exacerbated by the US dollar's decline following the passage of Donald Trump's tax and budget cuts bill. The weaker dollar is putting additional pressure on oil prices, as a cheaper greenback makes commodities more affordable for non-US buyers.

Moreover, US crude inventories unexpectedly rose by 1.3 million barrels, significantly exceeding analysts' forecasts. This development has reinforced bearish market sentiment, indicating weakening demand amid growing supply.

Meanwhile, the geopolitical tensions between Israel and Iran, which previously raised concerns about potential oil supply disruptions, have begun to ease. US-Iran negotiations have helped mitigate regional conflict risks, contributing to market stabilization and price moderation.

However, the long-term perspective appears unfavorable. An oil market surplus is anticipated in 2025, which will likely pressure prices and prevent any substantial rally.

The technical picture for Brent shows steady development of a downtrend. On the daily chart, prices are firmly trading below key moving averages the EMA (20) and EMA (50) confirming dominant bearish sentiment. The MACD indicator reinforces this outlook, remaining in negative territory with its signal line below the MACD line, suggesting potential further downside.

Current Recommendation:

Sell Brent at the current price. Take profit – 62.00. Stop loss – 65.60.