The rise in oil prices is supported by the easing of trade tensions between the United States and China
Global oil markets on Monday witnessed a significant rise in prices, as WTI crude jumped by more than 2% to reach a level close to 63 dollars per barrel, following the announcement of an important trade agreement between the United States and China.
The US-China trade agreement supports prices:
- The two countries announced a mutual reduction of customs duties by 115% for a period of 90 days.
- Reduction of US tariffs on Chinese imports from 145% to 30%.
- Reduction of Chinese tariffs on American products from 125% to 10%.
This agreement comes as a preliminary step to reach a long-term trade.
agreement Additional oil-supporting factors:
- The US-UK trade agreement that boosted optimism in the markets.
- Improved outlook for global economic growth.
- Expected increase in energy demand as trade relations improve.
Factors limiting the ascent:
- OPEC plans to increase production during the next May and June.
- The organization's attempts to balance supply and demand.
Oil at the technical level
We expected this rise during the past period, as oil is trying to complete the bat harmonic model during the current period near the levels of 63.50 dollars per barrel.
As mentioned here
What are the upcoming forecasts:
Expectations point to the continuation of the positive impact of the trade agreement in the short term, the likelihood of facing pressures at resistance levels around 63.50 dollars to 65.00 dollars per barrel, due to the market being affected by OPEC's expected decisions regarding production levels.
The oil market also remains sensitive to geopolitical and trade developments, with traders currently focusing on global demand indicators in light of the improving trade climate between the world's two largest economies.
