USOIL: Bearish channel with a consolidation phase before $70!

The prices of oil appear very negative as they record losses for the fourth consecutive day. Markets are selling crude oil futures contracts due to the current division within OPEC+ on how to proceed, with the prospect of a lack of severe measures to support oil prices. The postponement of the OPEC+ meeting to a virtual mode on Thursday highlights a deep division within the organization, signaling an unfavorable situation for oil prices, which require a united front to maintain current levels. In addition to Thursday's OPEC+ meeting, the COP28 meeting will begin in Dubai. Several market participants have expressed their forecasts on OPEC+'s decisions. The consensus is that even if OPEC+ extends the current production cuts, it is unlikely to lead to a strong rally. Oil prices are poised for further declines as there are no measures in place against the considered bearish factors. On a daily basis, the price has been inside a bearish channel for days and continues to descend. Currently, it is positioned between a supply and demand zone very close to each other, which could create a period of stagnation or consolidation. The sentiment remains bearish, and personally, I expect the price to head towards the $70.00 per barrel area. Greetings from Gaia, wishing everyone a good trading day.

Comment:

Oil prices are rebounding from Tuesday's lows, contributing to a positive performance for the week despite a more bearish tone in recent news. Meanwhile, markets have adjusted their positions regarding internal divisions within OPEC+, with tension now building ahead of Thursday's meeting and a potential reaction that could push crude oil higher. Additionally, OPEC has issued a statement defending the oil and gas industry in anticipation of the COP28 climate convention. The statement also opposes the International Energy Agency (IEA) and emphasizes the widespread debate on how to best address global warming. Saudi Arabia continues to call for all OPEC members to reduce their production quotas in a joint effort to support the supply side. As usual, on Tuesday evening around 21:30 GMT, the American Petroleum Institute is expected to release the latest inventory data. Previous data showed an increase of 9.047 million barrels, with projections now indicating a 2 million drawdown, potentially ending the inventory growth in November. Oil prices may have reached the bottom for now in their downturn. Price pressure is building ahead of the OPEC+ decision on Thursday. This evening, the API inventory numbers are expected to show a drawdown in stockpiles for the first time in November. This could mean that US production has reached its limits for now and will see demand soaring again in the global oil market, while OPEC+ seeks to support the supply. My short-term view remains bearish.