Crude oil prices saw a -1.39% decrease, closing at 6178, as traders struggled with opposing factors such as rising crude supplies in Libya and Norway versus US production outages and geopolitical tensions.
There are still a lot of unknowns surrounding different supply and demand indicators, which makes the market extremely volatile. According to the Norwegian Offshore Directorate (NOD), Norway’s crude production surpassed forecasts in December, increasing to 1.85 million bpd from 1.81 million bpd the previous month.
Production at Libya’s 300,000 bpd Sharara oilfield restarted on January 21 following output disruptions earlier in the month due to protests.
Nonetheless, supply limitations still exist in the US. In contrast to OPEC’s estimates of 2.25 million barrels per day. The International Energy Agency (IEA) increased its estimate for the growth of the world’s oil demand in 2024. Projecting an increase of 1.24 million barrels per day.
The Energy Information Administration (EIA) reports that although petrol and distillate inventories increased in the week ending January 12. U.S. crude stocks decreased more than anticipated. Additionally, there was a 2.1 million barrel decline in crude stocks at the delivery hub in Cushing, Oklahoma.
From a technical perspective, the market is undergoing long liquidation, as evidenced by the 3.95% decline in open interest to 11147 and the -87 rupee price decline.
Crude oil prices is supported at 6109, and a break below that could take it as low as 6040. Resistance is expect at 6256 on the upside, and a move above it could result in additional testing at 6334.