Oil’s Rally Falters After Kuwait Comments

Oil is under pressure in  Asia after comments from Kuwait over the weekend.

Oil continued its sideways consolidation on Friday, as both Brent and WTI rode the coattails of a general commodities rally to finish at 63.57 and 57.25 respectively. The picture has not been so bright this morning, as Kuwait’s oil minister over the weekend said that OPEC and Non-OPEC would study exit strategies before the joint meeting in June.

Although wholly rational and logical in itself (you would sensibly plan these things far in advance of the end of 2018 expiry), it was enough to send traders scurrying from long positions in early Asia. Brent has fallen 0.46% or 30 cents to 63.50 with WTI falling 0.40% or 25 cents to 57.00.

The UAE energy minister has since bought some clarity and voice of reason to the previous comments with,

“UAE ENERGY MINISTER SAYS OPEC, NON-OPEC PLAN TO ANNOUNCE AN EXIT STRATEGY FROM SUPPLY CUTS IN JUNE, DOES NOT MEAN WE WILL EXIT IN JUNE” Source: Reuters

Brent has resistance at the multiple daily tops at 64.00 followed by 64.45 and 64.85. Support is at 62.20 and then the critical 61.25 numerous daily lows.

Brent Crude

WTI spot has resistance at 58.00 and then 58.20, its trendline resistance ahead of the substantive 58.85 level, a daily triple top. Support is at 56.40 followed by 55.675.

WTI Daily

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Jeffrey Halley

Jeffrey Halley

Senior Currency Analyst
Based in Singapore, Jeffrey has over 25 years experience in the financial markets, having traded currencies, options, precious metals and futures. Jeffrey started his career at Barclays Bank in New Zealand. However he has spent most of it in London and Asia.Jeffrey focuses on the Asia time zone across asset classes. A regular commentator on business news TV and Radio, he is originally from New Zealand and holds an MBA from Cass Business School, London.