The oil market is declining during the trading session on Tuesday. Since the opening of the day, WTI crude oil has been losing about 0.7% and is quoted at $ 40.15 per barrel.
The decline in oil prices was caused by a significant deterioration in the epidemiological situation in the world, which made traders again doubt the prospects for a global economic recovery. Last weekend, the United States set a new record for the number of cases - 57.5 thousand people. According to The Washington Post, what is happening in the United States can well be called a second outbreak, the scale of which is already superior to the first. In total, 2.8 million infected are registered in the United States today. 129 thousand people died from the virus. In second place is Brazil's anti-rating with 1.5 million cases. Russia is located on the third line (667 thousand people). They are followed by Peru and India.
Earlier, oil prices supported Bloomberg reports that Saudi Arabia’s national oil company, Saudi Aramco, decided to raise oil prices in August for buyers in Asia, the US and Northern Europe. For Asian buyers, the premium for grade Arab Light will be $ 1.2 per barrel, for other grades of oil - a dollar per barrel. The premium for Northern Europe is now $ 0.7 more than the cost of Brent. On the side of oil buyers was another conflict in Libya, which caused a reduction in daily oil production from 1.2 million barrels per day to 100 thousand barrels.
Further oil dynamics will depend on the reaction of traders to the worsening situation with the coronavirus, on the dollar exchange rate, as well as data on changes in US oil reserves. The American currency is growing today, taking advantage of the support of a strong report on activity in the ISM services sector in the USA. A stronger dollar usually reduces the price of oil, as it makes it more expensive for buyers. Data on changes in stocks will be released tomorrow at 17:30 Moscow time. In the case of their growth or increase in oil production in the United States, sellers will have one more reason to strengthen the correction dynamics.
WTI SellStop $ 39.70 TP $ 37.50 SL $ 40.40
Analytical reviews and comments on them reflect the subjective opinion of the authors and are not a recommendation for trading. Posted by Artem Deev Trader Analyst at AMarkets . The social network of traders is not responsible for possible losses in case of using review materials
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