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Brent: Oil market follows the situation in the Middle East

Brent

Oil market retains upward movement vector amid escalation of the situation in the Middle East.

According to U.S. intelligence reports Saudi Arabia oil facilities were attacked from the territory of Iran. Now investors have concerns over retaliation from the Americans and Saudis, that can make the situation in the region even worse.  Direct military clashes between world’s biggest oil producing countries can drive to growth of oil prices towards many-year peaks. Yesterday the prices spiked nearly 20% in intraday trading in response to the drone strikes, the biggest jump in almost 30 years.
According to media reports today Saudi Arabia energy minister Prince Abdulaziz bin Salman will hold a press-conference with its details yet unknown. But all eyes will be on the Saudi news conference as Saudi Arabia is the world’s biggest oil exporter and has been the supplier of last resort for decades.

Beside the situation in the Middle East today investors will also follow the actual data from API on oil inventories in USA.

On the chart the price was able to stabilize above the 66.60 level creating good premises for further development of upward movement in direction of 72.50 level.

Resistance levels: 69.00, 71.00, 72.50;

Support levels: 66.60, 63.60, 62.30.

Main scenario: Retest of support at 66.60 and resumption of upward movement.

Alternative scenario: Break of support at 66.60 and decline towards 63.30.

Market retains positive sentiment for oil prices. Bullish signals prevail on the chart. For intraday trading we give preference to long-positions considering them at the 66.60 level. 

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