Oil prices are facing a third consecutive decline ahead of the OPEC+ meeting on Sunday. Analysts expect current production cuts to be extended into 2025, with the goal of keeping Oil prices near $80. The US Dollar Index is trading just below 105.00 after a volatile week driven by bonds and macroeconomic data.
Despite a near 3% decline in two trading days, Crude Oil prices are hovering below $78 on Friday. The performance for the week remains flat, with the potential for a gain ahead of the OPEC+ meeting. The meeting could see an extension of production cuts and is highly anticipated by market participants. The outcome of the meeting will likely have a significant impact on Oil prices moving forward.
The US Dollar Index has experienced a volatile week, trading just below 105.00. The Greenback showed strength on Wednesday following a surge in bond yields, before erasing gains on softer housing and Gross Domestic Product data. The market will closely watch the US Personal Consumption Expenditure Price Index report to determine the DXY’s direction for the week.
During the OPEC+ meeting, key takeaways include exempting Iran, Libya, and Venezuela from production cuts due to external constraints. Reports indicate that production cuts may be extended until 2025, with the United Arab Emirates and Kazakhstan planning to increase production. Traders are keeping an eye on the US economic outlook and housing market conditions, anticipating further volatility in Oil prices.
Oil prices reflect a lack of confirmation of increased demand in the market, with traders cautious about future trends. The Fed’s indication of a delayed rate hike in 2024 has impacted market sentiment. Technical analysis suggests that the SMA levels serve as key resistance and support points, with $76.00 and $75.27 as crucial levels to monitor for potential price movements.
WTI Oil is a high-quality Crude Oil sold on international markets, sourced in the United States. Supply and demand are key drivers of WTI Oil prices, influenced by global growth, political instability, and OPEC decisions. Weekly Oil inventory reports from API and EIA impact price fluctuations, with changes in inventories reflecting supply and demand dynamics. OPEC decisions, including production quotas and OPEC+ collaborations, play a significant role in shaping the Oil market.
