US Crude Oil - What Is The Most Likely Path

After breaking above the range of 65-75 in mid-October, crude oil seems to have developed a new trading range between 75 and 82. While bulls have been attempting push price higher above 80, selling pressures appear to be quite strong there. With solid supports from fundamentals, we suspect if price can sustainably rise above 82 in the medium-term

OPEC members are satisfied with oil price at 75-78. Angolan oil minister even said that 80/bbl is 'not too high'. However, it's believed OPEC should revisit its current policy should oil price reach 90.

Attack of Hurricane Ida curtailed imports and suspended operations of oil facilities. Therefore, declines in inventories were more than expected last week. Crude inventory drew -0.89 mmb to 336.8 mmb in the week ended November 13 as led by decline in the Gulf Coast as attack of Hurricane Ida suspended oil imports and productions. However, builds were seen in the East Coast, West Coast and the Midwest.

Technical Outlook

The chart of oil confirms that the trend remains intact with higher highs and higher lows on the weekly chart. We are still trading within the inside bar formation as I expect support all the way down to the lower body at $72.6.

Support levels in the interim
Finbonacci levels
38.2% = $75.5
50% = $73.5
61.8% = $71.5