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What are the forecasts for the oil market? Is there any hope of a recovery?
The International Energy Agency decreased its forecasts for the oil market on Thursday. Indeed, the coronavirus ruined the oil demand. Therefore, the Agency can’t give any optimistic guidelines. You might think that international borders have opened, and all the people, that waited for so long, broke out travelling. However, according to official data, there is still a low demand for jet fuel. Many countries have recently recorded fresh virus outbreaks, especially Europe and Latin America, where the coronavirus is spreading at a quite high speed.
Things are not so terrible as it may seem, OPEC+ members made all efforts to contain the prices at the current levels for almost two months. They have made enormous cuts of oil production, which pushed oil prices a little bit higher. Nevertheless, the prices are still well below pre-crisis levels, and they are unlikely to fully rebound soon.
Moreover, Libya’s port blockade will keep the North African’s crude oil out of the world market. Libya's oil export terminals are occupied. Therefore, it should help with the world’s supply glut. According to Bloomberg, Libya’s oil production dropped by 40% since July. It’s anticipated to be 1.2 million barrels in August. On the one hand, this blockade has made the devastating damage on the whole Libyan economy. On the other hand, it may decrease the world’s oversupply and push oil prices higher.
The Brent oil is slowly moving upward. There is the strong resistance at 200-day moving average at $46.50. It’s more likely the price will bounce off this resistance. However, if it manages to break it out, it will open doors to the key psychological mark at $50.00 at the 61.8% Fibonacci level. Sooner or later it should reach this level. Support levels are $43.50 and $42.00.
Important! To trade Brent oil with FBS you need to choose BRN-20V.
The resistance line is limiting USD/JPY on the upside and, unless the pair tries for a breakout (which anyway will meet resistance at 106.50 and 106.80), the easiest path for it will be to go down.
The NZD/JPY pair is trading within the cloud. A failed attempt to move higher will push the market to exit the Kumo, confirming a bearish scenario.
The NZD/JPY pair is now poised to exit the Kumo. If that happens, the currency pair will enter into a new bearish sentiment.
The New Zealand dollar is rising for the sixth straight day, outperforming its major peers. What is the reason? Let’s find out!
The U.S. Commerce Department said it will issue an order Friday that will bar people in the United States from downloading Chinese-owned messaging app WeChat and video-sharing app TikTok starting on September 20.
Oil keeps rallying for the fourth day in a row after Goldman Sachs claimed that the oil market is in deficit and also because of the recent storm in the Gulf of Mexico, which led to the sharp decline of oil production. It is the best week for oil since June!
