Last Thursday, the oil reached $ 65 for the barrel, which formerly many analysts were called a maximum level of growth. Hence the correction began. The reason for her was the information about the arrival of warm air in the United States; Traders began to expect the recovery of oil production and refining.
It is an abnormal cold, who paralyzed the American oil and gas sector, became one of the reasons for the rise in oil prices. According to Western media, about 40% of capacity was derived from the work. But these estimates did not receive confirmation by the US Mesnel Genera, which the week had previously recorded the decline in production only by 0.2 million, to 10.8 million barrels per day. Perhaps the stop of most power facilities was made after statistical calculations, and in this plan will be very important data in the current environment. At the same time, the Office noted a decrease in oil reserves in the country by 7.3 million barrels, the market was waiting for a reduction of 2.5 million. But this did not have a significant support for the "bulls".
At the beginning of the current week, oil fired powerfully, leaving above $ 65 per barrel. The warmth came to America, however, it turned out that many oil-producing and processing production facilities will need to be repaired to access the planned operation. These news traders and played the growth of black gold quotes.
Among other iconic news, it is worth noting the decline in the number of active drilling rigs for the first time in many months. As of last Friday, the indicator decreased already on one unit, up to 305 pieces. Everyone understands: it is also associated with weather phenomena.
No new positive for the growth of oil fundamental factors did not appear. Moreover, estimates on the timing of the restoration of passenger traffic, primarily aviation, deteriorate. Therefore, it is not surprising that the backfill in oil futures only increases - contracts with expiration in a year traded $ 5-6 cheaper than the nearest futures, which indicates the disbelief of the market participants in the preservation of prices at the current level.
So far, as a guide to reduce oil quotes, it is worth considering the psychologically important area of $ 60 per barrel. The stronger technical support is located in the area of $ 55, and the care of quotes to it should not be surprising.
Brent Oil Dynamics, Day Candles
Boris Soloviev, financial analyst