US Crude Oil Price Set to Stabilize at Higher Levels
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US crude oil price, news and analysis:
- The US crude oil price is pausing for breath after its strong advance ahead of US sanctions on Iran, which take effect on November 4.
- With US inventories rising, some of the concerns about a shortage of crude are receding.
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Crude oil price analysis
The price of US crude oil has increased sharply ahead of US sanctions on Iran and on concerns about Venezuelan output but further strong gains in the immediate future seem unlikely. The price has already climbed to its highest since November 2014 as Iranian supplies seem to be falling ahead of the sanctions and other producers have failed to fill the gap but the latest US inventory data suggest that the advance may stall near-term.
US Crude Oil Price Chart, Hourly Timeframe (September 12 – October 3, 2018)
US crude inventories rose by 907,000 barrels in the week to September 28, to 400.9 million barrels, the American Petroleum Institute said Tuesday, ahead of Wednesday’s official supply report from the US Energy Information Administration due at 1430 GMT. This is predicted to show that weekly crude inventories rose by 1,985,000 barrels after the previous week’s 1,852,000 increase.
That might not be enough to outweigh supply concerns but the scope for further strong price gains near-term seems limited.
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--- Written by Martin Essex, Analyst and Editor
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.