In 2022, a downtrend began in the oil market (shown by the blue channel), which is unfavorable for producing countries.
When the price of Brent crude hit USD 72/BBL in March (1), OPEC+ countries announced production cuts, causing the price to soar towards the upper channel boundary. But the downtrend did not stop.
Last week, the price of Brent crude again reached USD 72, which led to the announcement of the Saudis to cut production. On June 1, we wrote about the warning of the Minister of Energy of Saudi Arabia to market speculators to “watch out,” which led to the formation of a rebound (2) from the indicated level.
On June 4, the warnings ended and the Saudi Ministry of Energy officially announced that the country's production would fall to 9 million bpd in July from about 10 million bpd in May, the biggest decline in years, according to Reuters.
On Monday, May 5, trading opened with a bullish gap as Brent crude approached the USD 77.7/BBL level that acted as resistance in May.
“This market needs stabilisation,” Saudi Energy Minister Prince Abdulaziz bin Salman Al Saud said at a press conference. Suppose these words describe what could happen in the market before the end of the year — the entry of the price of Brent oil into a trading range, the lower limit of which will be the level of USD 72 per barrel, so persistently defended by the miners.
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