Oil jumps back above $75 with Russia facing Black Sea issues

Oil prices are set to pop higher with a pickup in demand. The demand comes from Indian refiners, the third biggest in the world, who are purchasing oil from nearby Middle Eastern countries for immediate delivery. The surge in demand comes as those Indian refiners face heafty delays of several weeks with their oil taking the long road around Africa, in order to avoid being attacked by Houthi rebels in the Red Sea. 

The US Dollar (USD) meanwhile is again residing near session lows with the Greenback not finding any support amidst all these geopolitical tensions. With US equities slowly but surely reaching all time highs, the risk-on sentiment in that asset class is the main driver for the devaluation of the US Dollar. The Greenback has no catalyst or main driver for now that could spark a turnaround, according to FX Street.

Crude Oil (WTI) trades at $75.30 per barrel, and Brent Oil trades at $80.55 per barrel at the time of writing. 

Oil News and Market Movers: India buys up market

• India buying up oil from near Middle Eastern countries for quick delivery, to circumvent the late deliveries of crude stock for their cracking and refining activities. 
• Reuters reports that Russia has halted Crude loadings in port Novorossiysk, due to severe weather conditions in the Black Sea.
• Linked to the above, Kazakhstan is reporting it is pausing its Oil output with the Caspian Pipeline Consortium (CPC) halting acceptance. Meanwhile presss agency Tass reported that the deliveries are back online since this afternoon. 
• Houthi Rebels attacked a commercial MSC United ship in the Red Sea on Tuesday.
• Deputy Prime Minister Alexander Novak said in an interview at Rossiya 24 TV Channel that Brent prices are to average $80-85/bbl in 2024. Russian Oil producers are complying with OPEC+ production restrictions. 

Oil Technical Analysis: Demand to pick from here

Oil prices are on track to hit $85 within a few weeks at this pace. The markets are redirecting their view as the current economic slowdown might be priced in, in full, Any hiccup in any way or form for the supply side could mean an uptick for Crude prices in the coming weeks. 

On the upside, $74 got broken and tested for support, offering more upside. Once through there, $80 comes into the picture. Although still far off, $84 is next on the topside once Oil sees a few daily closes above the $80 level. 

Below $74, the $67 level could still come into play as the next support level to trade at as it aligns with a triple bottom from June. Should that triple bottom break, a new low for 2023 could be close at $64.35 – the low of May and March – as the last line of defence. Although still quite far off, $57.45 is worth mentioning as the next level to keep an eye on if prices fall sharply.