Crude oil is moving higher today as traders are expecting that the crude inventory data may show a decline given that we have seen -1.5% rig count fall since last week at Bakken, -8.7% at Basin and -6.8% at Eagle Ford. So, in summary, what is expected is that supply glut could be stepping off the gas. Moreover, another significant element, which is also under focus is the slashing and reviewing of investment projects in the US, as the Friday US NFP data shows that most of the job loss was under this area.
The major resistance is near the $55 and the support is near the 45.50 mark.
However, the IMF announced that the world economic growth will grow slow at 3.1% vs their previous estimate of 3.3%- now this is clearly a negative news if you are holding oil in your portfolio.
Given Saudis have reduced their price for their Asian buyers for the month of November, and there are no chances of any OPEC meeting before December, because Kuwait has refused to come to the table for any meeting, it is difficult to knit a scenario under which the supply will go lower. Hedge funds have also reduced their long bets and Saudi Arabia is still determined to increase their share. I just do not see supply going lower any time soon. But yes, for now, the OPEC comments are triggering upward movement and expectations around the upcoming inventory data.