Oil price climbs following Powel’s testimony

WTI continued its uptrend on Tuesday morning, going as high as $79.7 per barrel, as OPEC+ expects only a small decline in demand due to the spread of the Omicron variance of the Coronavirus and its impact on transportation fuel demand. In addition, Kazakhstan’s president announced yesterday that Russian troops would withdraw from the area, which raises hopes that stability may be restored in a highly important region for the energy sector. 

Following Jerome Powel’s speech later on Tuesday, WTI price climbed further, breaking through the $80.5 per barrel resistance. It is currently testing that resistance and the outlook for oil is bullish. In case the trend is reversed today, support can be found at the $74.3 per barrel level.

Traders should pay special attention to US inflation indicators that are scheduled to be released on Wednesday. Monthly Consumer Price Index and Core CPI, are indicators of overall inflation in the US and are of great importance, as they can help investors gain insight into the Fed’s future monetary policy. Crude Oil Inventories in the US are also going to be released today. These data represent the primary gauge of supply and demand imbalances in the US market, which can lead to changes in production levels and price volatility.

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Written by:
Myrsini Giannouli

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