NYMEX Crude Oil is eyeing $74.44
International oil prices continued to fall on Wednesday (January 4), hitting a new low in a week and a half, dragged down by fears that the global economic downturn could lead to weak demand, while supply remained relatively sufficient. NYMEX Crude Oil looked at $74.44.
As of 4:06 PM Beijing time, NYMEX crude oil futures fell 1.27% to $75.95 a barrel, while ICE Brent crude oil futures fell 1.19% to $81.13 per barrel.
Concerns about weak demand continued to hang over the market. Major oil exporter Saudi Arabia is likely to further reduce its peak Arabian light crude price for Asian customers by around $1.50 a barrel in February, on track to hit a new low from November 2021 and just above the average Oman/Dubai crude price. Approximately $1.75/barrel.
The official selling price of Saudi crude is usually released around the 5th of each month and provides a reference for oil prices in countries such as Iran, Kuwait and Iraq, affecting the price of crude shipped to Asia by around 9 million barrels per day .
Russia has shifted its oil exports from Europe to Asia after the European Union banned imports of Russian crude by sea from December 5. Meanwhile, the Group of Seven (G7) countries have introduced price caps that limit Russia’s use of Western finance for oil trading, shipping and insurance services.
While Moscow announced a ban on crude sales to countries adhering to price caps last week, its major oil customers in Asia will not be affected and more Russian barrels are expected to flow into Asia.
The market is still concerned about the impact of macro factors such as economic downward pressure. The head of the International Monetary Fund has previously warned that the economies of much of the world will have a tough year in 2023 as the main engines of global growth experience weaker economic activity.
After raising interest rates four times in a row by 75 basis points, the Fed cut its rate hike to 50 basis points in December. If the Fed ramps up its rate hikes, it could slow economic growth and dampen demand for fuel.
On the daily chart, NYMEX crude oil is down below $77.13 and is expected to further test $75.79 and $74.44, which are the 38.2%, 50% and 61% Fibonacci retracement levels, respectively. .8% of the bullish range of $70.10-$81.48.
