Despite a rebound in the early session driven by concerns over supply disruptions and rising tensions in the Middle East, crude oil futures could continue their downtrend as market reactions to disappointing US job growth data and weak economic signals from China created a wave of negative sentiment.
Today’s price bump was partly driven by fears of a broader Middle Eastern conflict and reduced Libyan production. However, these factors could be insufficient to sustain a recovery as broader market concerns took over.
Concerns about weakened demand and a potential US recession could continue to weigh on the oil market. This is despite reduced output from Saudi Aramco and ongoing production cuts by OPEC+ aimed at stabilising global prices.
Traders could now turn their attention to the United States Crude Oil Stocks Change which will be revealed today and tomorrow. A drop in crude inventory data could support oil prices to a certain extent although selling pressure could remain.
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