- Summary:
- Crude oil price on the Brent benchmark is up 0.39% on the drawdown in crude oil inventories, but it is labouring to break above the $50 mark.
A drop in crude oil inventories was not enough to lead to an upside push in crude oil prices this Wednesday. According to the weekly report by the Energy Information Administration (EIA), crude oil inventories had a 3.1 million barrels shortfall for the week ended December 11, 2020. This was a massive drop from the 15.2 million barrels overstock seen the previous week. This represented a larger-than-expected drawdown, as consensus was for a drop by 2.8 million barrels.
Gasoline production rose in the week under review, while US crude oil imports decreased by 1.1 million barrels per day from a week earlier. Refinery crude oil inputs dropped by 253K barrels from the previous week.
In spite of the report, crude oil prices on the Brent benchmark found very little bullish momentum.
Technical Levels to Watch
Brent crude is 0.39% higher on the report and is making a laborious attempt at clearing the 50.64 resistance. Price needs to break the 50.64 resistance with a double successive candle closing penetration above this level to initiate a run towards 52.67, which is the next target.
On the flip side, failure to break the 50.64 resistance leaves the triangle pattern vulnerable. A breakdown towards 48.33 invalidates the bullish expectations and opens the door to further downside push towards 46.41.
Brent Crude; Daily Chart
