Market news

23 September 2022

WTI sees a downside to near $80.00 as global growth forecasts trim

  • Oil prices are expected to decline further as western central banks have hiked interest rates further.
  • US gasoline demand has trimmed significantly as US corporate has curtailed investments.
  • OPEC+ has cut production targets by 3.58 million bps to support oil prices.

West Texas Intermediate (WTI), futures on NYMEX, is facing selling pressure while attempting to deliver a bullish reversal. The oil prices are hovering around $83.00 and are expected to tumble further to near $80.00. On a broader note, the black gold is displaying a vulnerable performance for the past three weeks after surrendering the psychological support of $90.00.

A lot of resisting global catalysts have brought an intense sell-off in oil prices. Starting from the hawkish stance by western central banks on their interest rates where the agenda of bringing price stability is sacrificing the extent of economic activities. A decline in economic activities as corporate is not investing due to the unavailability of cheap money a desk. Also, the postponement of expansion plans has trimmed demand forecasts. Eventually, the demand for oil is falling sharply.

The demand for oil in the mighty US economy is falling vigorously. US gasoline demand has slipped sharply by 8.5 million barrels per day over the past four weeks. This has been the outcome of accelerating price pressures, which have forced households to stick with essentials only.

Meanwhile, an unchanged policy announcement from the People’s Bank of China (PBOC) dented the sentiment toward oil prices. As overall demand is not picking up in China and price pressures are strictly lower, a rate cut was expected. However, a neutral stance adopted by the PBOC weakened the oil bulls.

On the supply front, OPEC+ has trimmed the overall production by 3.58 million barrels per day, which accounts for 3.5% of global demand. Despite a decline in global supply, oil inventories are building, which strengthens the signs of recession ahead.

 

 

 

Market Focus

Material posted here is solely for information purposes and reliance on this may lead to losses. Past performances are not a reliable indicator of future results. Please read our full disclaimer.

Open Demo Account
I understand and accept the Privacy Policy and agree that my name and contact details can be used by TeleTrade to contact me about the information I have selected.
23 International Awards
Have a question?

We are ready to assist you in every step of your trading experience
by providing 24/5 multilingual customer support.

Follow us

Risk Warning: Trading Forex and CFDs on margin carries a high level of risk and may not be suitable for all investors. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Prior to trading, you should take into consideration your level of experience and financial situation. TeleTrade strives to provide you with all the necessary information and protective measures, but, if the risks seem still unclear to you, please seek independent advice.

© 2011-2022 Teletrade-DJ International Consulting Ltd

Teletrade-DJ International Consulting Ltd is registered as a Cyprus Investment Firm (CIF) under registration number HE272810 and is licensed by the Cyprus Securities and Exchange Commission (CySEC) under license number 158/11.

The company operates in accordance with the Markets in Financial Instruments Directive (MiFID).

The content on this website is for information purposes only. All the services and information provided have been obtained from sources deemed to be reliable. Teletrade-DJ International Consulting Ltd ("TeleTrade") and/or any third-party information providers provide the services and information without warranty of any kind. By using this information and services you agree that under no circumstances shall TeleTrade have any liability to any person or entity for any loss or damage in whole or part caused by reliance on such information and services.

TeleTrade cooperates exclusively with regulated financial institutions for the safekeeping of clients' funds. Please see the entire list of banks and payment service providers entrusted with the handling of clients' funds.

Please read our full Terms of Use.

To maximise our visitors' browsing experience, TeleTrade uses cookies in our web services. By continuing to browse this site you agree to our use of cookies.

Teletrade-DJ International Consulting Ltd currently provides its services on a cross-border basis, within EEA states (except Belgium) under the MiFID passporting regime, and in selected 3rd countries. TeleTrade does not provide its services to residents or nationals of the USA.

Material posted here is solely for information purposes and reliance on this may lead to losses. Past performances are not a reliable indicator of future results. Please read our full disclaimer.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Choose your language/location