Crude oil prices have surged above $80 per barrel, driven by high fuel demand and a supply shortage following the global economic rebound from the Covid-19 pandemic.
Price of crude has been trading between $85.38 in October and $78 in November.
The price of oil reached a high of $84.92 after the Organization of the Petroleum Exporting Countries and its allies (OPEC+) refused a call from US President Joe Biden to raise oil production to curb soaring oil and gas prices.
Foxbusiness.com reported that when asked about rising gas prices and energy independence, Biden’s energy secretary Jennifer Granholm said: “Oil is a global market. It is controlled by a cartel.
“That cartel is called OPEC, and they made a decision yesterday that they were not going to increase beyond what they were already planning.”
Analysts and oil investors last week were waiting to see whether Biden would address soaring
gasoline prices by authorising a sale from the US Strategic Petroleum Reserve, which is held in a series of caverns on the Texas and Louisiana coasts, Reuters reported.
OPEC last week also cut its world oil demand forecast for the fourth quarter by 330,000 barrels per day from last month’s forecast, as high energy prices hampered economic recovery from the Covid-19 pandemic, according to Reuters.
Early this week, according to technical analysis on the daily chart, the oil price is correcting lower heading to the 50-day moving average of $77.86, while the 200-day moving average is at $68.98.
For this week’s trading recommendation, investors could look for trading opportunities by selling oil in the range of $80.50 to $76, setting a stop-loss function at $82 and a take-profit at $76.