- Crude oil slides back near $71.00 as markets react to recent developments in Israel.
- U.S. Secretary of State Blinken intensifies diplomatic efforts, aiming to secure a deal favorable for Harris.
- The U.S. Dollar Index stabilizes around 104.00, ahead of the U.S. Durable Goods report.
Crude oil prices are experiencing a modest uptick on Friday, despite headlines indicating that U.S. Secretary of State Antony Blinken may facilitate ceasefire talks between Israel and Iran. The Biden administration is intensifying efforts to broker a ceasefire ahead of the U.S. presidential election on November 5, with a successful outcome potentially benefiting the administration and bolstering Kamala Harris’s presidential ambitions.
At the same time, the U.S. Dollar Index (DXY), which measures the Greenback against six other currencies, is declining further on Friday following disappointing U.S. Durable Goods data for September and in anticipation of the University of Michigan’s final October reading. The closing position of the DXY on Friday will be crucial, as it may influence its potential rally next week amid uncertainties surrounding the presidential election outcome.
As of the latest update, Crude Oil (WTI) is trading at $71.25, while Brent Crude is at $75.07.
Oil News and Market Movers: Anticipating Next Week’s Developments
- The International Energy Agency (IEA) has cautioned that global demand growth is expected to weaken further due to a slowdown in China and increased adoption of electric vehicles, according to Bloomberg.
- Next week, major oil companies such as BP, Shell, Chevron, and ExxonMobil will report their Q3 earnings, with additional reports anticipated from PetroChina, Sinopec, and TotalEnergies, as reported by Reuters.
- Eni recently sold a shipment of CPC Blend to ExxonMobil, and Neste’s CEO noted that the oil refining sector has faced challenges this year, according to Reuters.
Oil Technical Analysis: Supply Considerations
Crude oil prices have struggled to maintain levels above the key thresholds of $71.46 and $71.68. Falling below these pivotal points raises the risk of further downside. Should Secretary Blinken succeed in securing a ceasefire or at least facilitating discussions, crude oil prices may experience additional declines.
On the upside, reclaiming the 55-day Simple Moving Average (SMA) at $71.68 is the immediate target, followed by the significant technical barrier at $75.01, which encompasses the 100-day SMA and other pivotal levels.
Conversely, traders should monitor lower levels, particularly $67.12, which served as support in May and June 2023. A breach of this level could lead to the year-to-date low of $64.75, followed by the 2023 low at $64.38.
