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WTI Crude futures are currently trading at $71.20-lower by 1.9% as compared to the previous closing. Oil prices dropped on Thursday as global stock markets fell, with investor sentiment becoming more bearish by an industry report indicating U.S. crude inventories rising more than expected.
Brent crude futures were trading at $80.92-lower by about 1.93% at the time of writing. On 3rd of October, it hit a four-year high of $86.74.
The EIA reported today that US crude inventories rose by 5.987M barrels for the week ended 5th October. The Markets had expected the EIA to report a climb of 2.620M barrels for the week. Also, the EIA said in its monthly forecast on Wednesday that U.S. oil output is expected to rise 1.39 million bpd to a record 10.74 million bpd this year.
In a related report that is published by API every week, the API reported on Wednesday that U.S. crude supplies rose by 9.7M barrels for the week ended Oct. 5 to 410.7M barrels.
In the U.S. Gulf of Mexico, producers have cut daily oil production by roughly 42% due to Hurricane Michael, the Bureau of Safety and Environmental Enforcement said. The cuts represent 718,877 barrels per day of oil production.
OPEC Secretary-General Mohammad Barkindo said at a conference on Thursday that there are many non-fundamental factors influencing the oil market that are beyond oil producers’ control. The Secretary-General also said at the Oil & Money conference in London that he wanted to ensure there is no shortage of crude in the market.
On the technical front, the RSI is currently at 45.83% and suggests that the market can move in the downward direction. The %K has crossed the % D from above to the downside at 94.85%, and this suggests that the market may head downwards. The current price is below the middle line of the Bollinger bands and is heading downwards.
Trade Suggestion-Limit Sell At 71.50, Take Profit At 70.50 Stop Loss At 72.00