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“Crude oil exhibited significant volatility, extending its gains to reach a 5-1/2 month high amidst escalating tensions in the Middle East and constrained supply from OPEC+ nations. On Monday, both international oil benchmark prices experienced a decline of more than $1 per barrel. This was attributed to a reduction in Middle East tensions, following Israel’s withdrawal of additional troops from southern Gaza and their commitment to fresh discussions regarding a potential ceasefire in the ongoing six-month conflict. Also, the release of better-than-expected U.S. job data for March may further bolster demand for crude oil in the forthcoming months. Anticipating today’s session, we foresee crude oil prices to maintain their volatility. Support levels for crude oil stand at $84.05–83.40, with resistance observed at $85.10-85.70. In terms of INR, crude oil is expected to find support at ₹7,120-6,980 and resistance at ₹7,340-7,420,” stated Rahul Kalantri, VP Commodities at Mehta Equities Ltd.
What’s driving the crude oil prices?
- Israel declared on Sunday that it was removing more troops from the southern Gaza region. This action is a part of a year-long plan to gradually reduce the number of troops in order to lessen the workload for reservists.
- Meanwhile, when both Israel and Hamas sent delegations to Egypt for negotiations ahead of the Eid holidays, talks on a truce were rekindled.
- Notwithstanding the factors affecting the oil demand forecast, the latest U.S. employment data, which was made public on Friday, shows that the economy had a strong first quarter.
- Investors will be keenly monitoring China’s and the United States’ consumer price index data this week in an attempt to gauge the country’s economic health and obtain information about when the Federal Reserve may change interest rates.
