Fundamental analytics

Brent:Oil market showed positive reaction to the news about replacement of Saudi Arabia’s Energy Minister

Brent

Oil market opens new trading week in the green reacting to the news reporting replacement of Saudi Arabia’s Energy Minister. Khalid Al-Falih will be replaced by the son of Saudi Arabia’s king prince Abdelaziz bin Salman Al Saud. His appointment marks the first time a Saudi prince from the ruling Al Saud family heads the important energy ministry. Most experts suppose that these changes won’t influence oil policy of the kingdom and new chairman of Energy Ministry will work over enhancement of relations between OPEC countries.

Positive impact on the market now is created by the situation on stock markets. Most of the indices are starting trading week in the green reflecting overall investor’s disposition to risk. Traders expect from ECB, Federal Reserve and other regulators softening of monetary policy in order to stimulate economic growth. Investors hope that these actions will facilitate recovery of global economy and energy demand.

On the chart we can see that locally an upward movement is in progress. The closest target for buyers is 62.30 level where the further mid-term vector of price movement will be defined. In case of break of resistance we might expect growth of the quotes towards 66.60. In case of forming of reversal formation we expect decline towards 57.50.

Resistance levels: 62.30, 64.70, 66.60;

Support levels: 60.75, 59.30, 57.50.

Main scenario: Growth towards 62.30.

Alternative scenario: Break of support at 60.75 and decline towards 59.30.

Positive fundamental sentiment prevails on the market locally. In short-term we consider long-trades for this asset seeking entry points at area of 60.75 level.