The volatile season for the Oil market continues as WTI stabilized at higher grounds in the past days. In the most recent daily sessions WTI’s price had undertaken considerable swings that will be detailed in this report along with the most important fundamental updates in the industry. Our WTI technical analysis will be presented as our final part of this report, providing insights on important levels for traders to consider.

In the past days the US weekly Oil market data created some volatility for the WTI’s price thus could be worth keeping in mind for the days to come. On Wednesday the EIA weekly Crude Oil Inventories figure displayed a surplus of 1M barrels which was lower than the forecasted and previous figure. The reading sent WTI prices in a bearish momentum reaching nearby $80 per barrel while the selling was ongoing for a few hours after the release. On the flip side the weekly API crude oil inventories released on Tuesday indicated a notable drawdown of -2.5M barrels which sent prices higher reaching approximately $83 per barrel. During the previous Friday the weekly Baker Hughes rig count implied active US Oil rigs jumped to 450 which was higher than both previous and expected figures. No major market reaction was observed upon release yet from the reading we understand that active Oil rigs continue to be on the rise but remain far from levels seen prior to the pandemic. Our conclusion remains intact that traders are monitoring the weekly readings with most emphasis placed on the EIA and the API and this behavior can follow us well into the next week.

In the past days, the EIA released its November 2021 monthly report that included some interesting information in accordance to the administration’s views and outlooks. Some of the topics we found interesting and could move Oil prices include first the fact that a number of countries like Thailand, Israel, Australia, and the United States, have now opened their borders and traveling for tourism or business is now allowed. This move could uplift fuel demand. Second the EIA approximates world crude oil consumption has exceeded crude oil production for five consecutive quarters which is a confirmation that Oil supply has remained depleted possibly due to the uncertainty surrounding the pandemic. Moreover the EIA clearly stated “Oil demand will exceed global supply through the end of the year and keep the Brent crude oil price above $80/b through December. Finally a more long-term view by the EIA found the administration expecting global oil stocks to start building in the next year, driven by rising production from OPEC+ and the United States, accompanied by decelerating growth in global oil demand. In this scenario the EIA expects downward pressure on Oil prices.

As a final note, we would like to advise caution for traders considering the news related to the US Government using its strategic Oil reserves to bring prices lower. This idea had been considered in the pre pandemic era many times, but did not materialize as this may not be the most appropriate move for the time being. Lastly, according to Reuters, the most recent months have been the weakest for fuel exports from China which were impacted by plummeting fuel demand across Asia with lockdowns imposed in countries in the area. China has also been affected by high energy prices which led to a cut down on its imports of the commodity, while the internal energy crunch the country is facing may also be among the reasons for lower imports and subsequently lower exports.