Prices for WTI and Brent crude today rose by more than 1% after the publication of API data on the reduction of oil reserves.
According to the American Petroleum Institute for the week, oil reserves fell by 5.8 million barrels to 484.5 million barrels. The indicator has been declining for the third week in a row.
EIA's weekly stock data will be released later today. A decrease of 2.27 million barrels is expected. The API report shows that the actual decline in inventory may be more significant.
Additional support for the market is provided by reports that Saudi Arabia has begun to reduce the volume of supplies of raw materials to refineries in Asia and Europe. The decline in supplies is taking place within the framework of the agreements that were reached at the OPEC meeting earlier this month. Saudi Arabia agreed to cut supplies by 1 million barrels in February and March. According to information sources, the volume of supplies to refineries in Asia will decrease by about 20-30%. The decline in supplies comes amid an overall decline in demand for crude oil in Asia due to the peak refinery maintenance season from March to April.
On the chart, the price almost reached the previously mentioned target at 54.00. This is a strong resistance level from which we can see the formation of a fairly strong pullback movement.
· Resistance levels: 54.00, 55.00, 57.00.
· Support levels: 52.70, 51.30, 50.00.
The main scenario is an increase above 54.00 and a downward reversal.
An alternative scenario is a rollback from current levels to 52.70 and renewed upward movement.
The current fundamental background is moderately positive. We consider longs after a price rollback in the range of 52.70-52.90.