Crude oil price catching a breather after being on a decline for two consecutive sessions. The fall is a reaction to the rising COVID-19 cases. India, which is the third-largest oil importer in the world, is recording overwhelming numbers of coronavirus infections. WTI futures are up by 0.46% at 61.34. At the same time, Brent futures are down by 0.18% at 65.40.
Rising COVID-19 Cases
Over the past 24 hours, the nation has recorded 300,000 new COVID-19 cases. This is the highest daily figure that any country has recorded. Besides, about 2100 individuals have died of coronavirus-related complication; which is the country’s highest daily tally. Subsequently, it is about to hit 16 million confirmed cases. This places it at second position after the United States. Oxygen shortage in health facilities has not made the situation any better. The impact of these numbers on crude oil price has been of concern to those looking to trade oil.
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Japan, the fourth-largest oil importer is also struggling with rising COVID-19 cases. The confirmed cases have surpassed 142.5 million. On Thursday, the country recorded 1167 new cases; slightly down from 1242 on Wednesday. Subsequently, Osaka and Tokyo is set to be under coronavirus emergency between 25th April and 11th May.
Despite these bearish catalysts, optimism regarding the recovery of global oil demand has offered support to crude oil price. IEA and OPEC have both adjusted their forecasts of oil demand on the upside.
Crude Oil Price Technical Forecast
Crude oil price is seesawing around $61 as the market reacts to the rising COVID-19 cases and the recent data on US oil inventories. At the time of writing, WTI futures were up by 0.46% at 61.34 after hitting an intra-day low of 60.57. On a 3-hour chart, it is trading below the 25 and 50-day exponential moving averages.
Despite the bearish catalysts, I am of the opinion that crude oil price will rise to 62, which has been an important resistance level since early March. However, with the ongoing demand concerns, bears will have enough energy to push it to 60. As such, it is likely to be range-bound between the two levels in the ensuing sessions. Outside that rectangular pattern, the targets to watch out for will be 59 and 63 on the lower and upper side respectively.