Oil prices slid on Thursday, amid global recession fears, with WTI falling to $104 per barrel. If the WTI price retreats, support can be found further down near $98 per barrel, while resistance can be found near the $121.2 per barrel level and higher up at $130 per barrel.
Reports that US President Joe Biden may move to suspend fuel taxes have also driven oil prices down, although the proposed federal tax cuts may not pass the Congresses’ approval.
Oil prices have tumbled to a four-week low, amid concerns that interest rate hikes could slow global economic growth, reducing energy demand. An increasing number of major Central Banks are moving towards a tighter fiscal policy to tame soaring inflation rates. Stalling economic growth, combined with fiscal tightening gives rise to fears of recession, pushing oil prices down.
Last week, the US Federal Reserve voted to raise its benchmark interest rate by 75 points and the BOE by 25 base points. Other major banks, such as the Bank of Switzerland and the Bank of Canada, are also raising their interest rates, halting the ascend of oil prices.
Tight oil supplies are supporting oil prices though, as many OPEC members continue to underperform, raising doubts on whether the organization can maintain its output goal. Geopolitical tensions also support oil prices, as tight supply raises fears of an energy crisis, especially in the EU.
The oil demand outlook has increased, as in the summer, there is increased traveling and driving, boosting oil demand. The zero-Covid lockdown in Shanghai has officially ended, increasing the demand outlook and boosting oil prices. It seems however that Covid restrictions are not over in China, creating uncertainty in oil demand. China is the largest importer of crude oil and Covid lockdowns have dampened oil demand, pushing prices down.
The content provided in this material and/or any other material that this content is referred to, whether it comes from a third party or not, is for information purposes only and shall not be considered as a recommendation and/or investment advice and/or investment research and/or suggestions for performing any actions with financial products or instruments, or to participate in any particular trading strategy and cannot guarantee any profits. Past performance does not constitute a reliable indicator of future results. TopFX does not represent that the material provided here is accurate, current, or complete and therefore shouldn't be relied upon as such. This material does not take into account the reader's financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of TopFX, no reproduction or redistribution of the information provided herein is permitted.
as a Liquidity Provider
and reliable execution
Fill in the registration
form and click
Once you are in the client secure area, please proceed with uploading your Proof of Identity and Proof of Residence.
When your live account is approved, you can deposit funds and start trading on your chosen platform!
The website you are now viewing is operated by TopFX Global Ltd, an entity which is regulated by the Financial Services Authority (FSA) of Seychelles with a Securities Dealer License No SD037 that is not established in the European Union or regulated by an EU National Competent Authority.
If you wish to proceed please confirm that you understand and accept the risks associated with trading with a non-EU entity (as these risks are described in the Own Initiative Acknowledgment Form and that your decision will be at your own exclusive initiative and that no solicitation has been made by TopFX Global Ltd or any other entity within the Group.
Don't show this message again
These cookies fall under the following categories: essential, functional and marketing cookies. Marketing cookies may also include third-party cookies.