Crude oil price, news and analysis:
- The price of US crude continues to rise and the outlook is still constructive on tight supplies and concerns about Venezuelan output.
- Technically, the price remains in an upward-sloping channel that has been in place since late December.
Positive outlook for US crude oil
Further gains in the price of US crude oil are possible as the recovery that began in late December last year shows no sign of reversing just yet.
From a fundamental perspective, the price is benefiting from data suggesting that supplies from the Organization of the Petroleum Exporting Countries fell by the most in two years last month, with Saudi Arabia leading the way. Output from OPEC’s 14 current members fell by 930,000 barrels a day to 31.02 million, according to a Bloomberg survey.
Moreover, Venezuela is struggling to export oil because of US sanctions in support of “interim president” Juan Guaidó, who is challenging the incumbent Hugo Chávez. These factors have helped lift the price from a low of $42.95 in late December to its current level around $55.30 per barrel – not far from the 2-1/2 month high reached Monday.
US Crude Oil Price Chart, Hourly Timeframe (December 20, 2018 – February 5, 2019)
Chart by IG (You can click on it for a larger image)
Technically, the crude oil price remains within the rising channel in place on the chart throughout this year so far and its climb could well extend towards the channel resistance line, currently around $56.30. Meanwhile, support from the lower trendline around $53.65 should limit any near-term falls.
More to read:
All you need to know about crude oil
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--- Written by Martin Essex, Analyst and Editor
Feel free to contact me via the comments section below, via email at martin.essex@ig.com or on Twitter @MartinSEssex
