Choose country & language:
Oil prices remained steady on Tuesday, with WTI prices fluctuating around the $80.1 per barrel level. If the WTI price declines, it may encounter support near $79.3 per barrel, while resistance may be found near $83.4 per barrel.
Increased US rate hike expectations counteracted upbeat data from China on Tuesday. China is the world’s largest energy importer and prolonged lockdowns have dampened oil demand. China's GDP data this week showed that the country’s economy grew by 4.5% in the first quarter of 2023. China’s economy seems finally to start recovering post-Covid. IMF estimates that the country’s GDP will grow 5.2% this year and 5.1% in 2024.
The Federal Reserve raised interest rates by only 25 basis points at its meeting in March, bringing the benchmark interest rate to a target range of 4.75% to 5.00%. Market odds are currently in favor of another 25-basis point rate hike at the Fed’s next meeting in May.
The recent banking crisis has been driving oil prices down in the past few weeks. The potential of a banking sector meltdown has reduced the oil demand outlook, as recession concerns mount. Fears of a slowdown in the U.S. economy also put pressure on oil prices. Recession concerns run high and aggressive rate hikes stifle economic activity, putting a lid on oil prices.
Oil prices surged however, after OPEC+ producers decided to reduce output by 1.1 million barrels per day, to offset the drop in oil prices from the global banking crisis. The cuts will start in May and last through the end of the year.
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.
Written by:
Myrsini Giannouli
industry presence
as a Liquidity Provider
and reliable execution
client funds
customer support
Fill in the registration
form and click
"Create account".
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!
