Crude Oil Hits Three-Month Highs Above $120
The barrel of Western Texas Intermediate (WTI) crude reached its highest level in three months above $123 and recorded a 2.3% gain on Wednesday following the release of U.S. crude inventories data by the Energy Information Administration. The barrel of Brent rose past $124 per barrel and scored a daily gain of 2.5%.
On the supply side, EIA data showed that U.S. crude inventories fell 2 million barrels in the week ending June 3, while gasoline inventories fell by 800,000 barrels and inventories of distillates increased 2.6 million barrels.
At the same time, prices were supported by the potential for a strike by Norwegian offshore oil workers next week, which could cause output shortages from the largest producer in Western Europe outside Russia.
Both WTI and Brent have risen more than 30% since the Russian invasion of Ukraine on February 24, adding to inflationary pressures in major economies.
On the demand side, the relaxation of Covid-related policies in China is another bullish factor for the crude prices, as it means higher demand from the world's largest importer.
The short-term technical outlook for WTI remains bullish, according to the daily chart, after the price broke above the $120.00 threshold.
The RSI has accelerated higher in convergence with the price and is close to overbought territory, while the MACD has printed a new green candle and continues to gain momentum.
To the upside, the next resistance level is seen at $125.00, followed by the March 8 high at $129. On the other hand, immediate support is seen at the $120.00 level, followed by the 20-day SMA at $114.00 and then the $112.50 area.
On the supply side, EIA data showed that U.S. crude inventories fell 2 million barrels in the week ending June 3, while gasoline inventories fell by 800,000 barrels and inventories of distillates increased 2.6 million barrels.
At the same time, prices were supported by the potential for a strike by Norwegian offshore oil workers next week, which could cause output shortages from the largest producer in Western Europe outside Russia.
Both WTI and Brent have risen more than 30% since the Russian invasion of Ukraine on February 24, adding to inflationary pressures in major economies.
On the demand side, the relaxation of Covid-related policies in China is another bullish factor for the crude prices, as it means higher demand from the world's largest importer.
The short-term technical outlook for WTI remains bullish, according to the daily chart, after the price broke above the $120.00 threshold.
The RSI has accelerated higher in convergence with the price and is close to overbought territory, while the MACD has printed a new green candle and continues to gain momentum.
To the upside, the next resistance level is seen at $125.00, followed by the March 8 high at $129. On the other hand, immediate support is seen at the $120.00 level, followed by the 20-day SMA at $114.00 and then the $112.50 area.