- Crude oil recorded a modest gain of 0.33%, settling at 6027.
- U.S. crude oil stocks increased by 1.837 million barrels in the week marking the largest weekly gain.
- The market is undergoing fresh buying, with a 1.26% increase in open interest to settle at 14,989.
Crude oil recorded a modest gain of 0.33%, settling at 6027, despite eased concerns about shipping disruptions in the Red Sea, even as tensions persist in the Middle East, reports Investing.
Crude rise amid shipping interruptions
Denmark’s Maersk’s decision to route almost all container vessels through the Suez Canal reflects a positive outlook for global trade, while only diverting a few around Africa. In the U.S., crude oil stocks increased by 1.837 million barrels in the week ending December 22nd, marking the largest weekly gain since November 17th. The rise comes after a 0.939 million barrels increase in the previous week.
The U.S. finalized contracts to purchase 3 million barrels of oil to replenish the Strategic Petroleum Reserve (SPR), following last year’s historic sale. The purchased oil, averaging $77.31 per barrel, signifies a strategic move at a lower cost compared to the average of $95 per barrel in 2022. Approximately 14 million barrels have been acquired for replenishment, with around 4 million barrels returning to the SPR by February as oil companies return loaned oil. In Nigeria, exports of four main crude oil grades in February are expected to average about 657,000 barrels per day, a slight decrease from the previous month.
Technically, the market is undergoing fresh buying, with a 1.26% increase in open interest to settle at 14,989. Crude oil’s support is identified at 5984, with a potential test of 5941 below this level. Resistance is expected at 6053, and a move above could lead to a test of 6079.
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Source: Investing
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