Russian Oil Production Will Be Irreplaceable

Summary:

The Bank for International Settlements assessed in its quarterly report on Monday that replacing Russia's oil supplies could be a daunting task for the West in the long run. The fundamental problem is Russian oil's huge market share, as Russia alone accounts for 10% of global oil exports. In addition, losing supplies of Russian oil products would have a major negative impact on the global economy, and other producers are unlikely to have enough capacity to fill the shortfall. Also, investment in discovering and drilling new wells remains below pre-pandemic levels. However, the G7 agreed this month to set a price cap on Russian oil exports.

BUY WTI

Close Time

CLOSED

84.720

Entry Price

86.140

83.540

91.940 +1.265 +1.40%

118.0

Pips

Loss

83.540

83.497

Exit Price

84.720

Entry Price

86.140

I. Fundamentals

Replacing Russian oil supplies could be a daunting task for the West in the long term, the Bank for International Settlements assessed in its quarterly report on Monday. The fundamental problem is Russian oil's huge market share, as Russia alone accounts for 10% of global oil exports. In addition, losing supplies of Russian oil products would have a major negative impact on the global economy, and other producers are unlikely to have enough capacity to fill the shortfall.

Besides, investment in discovering and drilling new wells remains below pre-pandemic levels. However, the G7 agreed this month to set a price cap on Russian oil exports, while the West begins boycotting Russian oil. But under plans that are still taking shape, the G7 hopes to force Russia to sell oil to big buyers such as India at much lower prices in the future. Furthermore, restrictions on Russian oil exports are likely to be accompanied by sharp and prolonged increases in prices, including food.

II. Technical Analysis

2.1 WTI Crude Oil Weekly Chart

WTI: Russian Oil Production Will Be Irreplaceable_1

The price is supported by the descending trendline which started on July 15, 2022.

The strong support of the moving average below is near 78.

The key resistance above is near 87.1.

2.2 WTI Crude Oil Daily Chart

WTI: Russian Oil Production Will Be Irreplaceable_2

The price is suppressed by the descending trendline which started on August 30, 2022.

It closed with a Doji candlestick with a long lower shadow in the lower space of the range, indicating the establishment of the phased bottom, and the trend turns bullish.

The key resistance above is near 83.8.

2.3 WTI Crude Oil 4-Hour Chart

WTI: Russian Oil Production Will Be Irreplaceable_3

The price breaks above the descending trendline which started on September 14, 2022, indicating the trend turns bullish.

WTI: Russian Oil Production Will Be Irreplaceable_4

Regarding WTI crude oil, it is recommended to go long at lows.

Entry price: 84.72,

Take profit: 86.14,

Stop loss: 83.54.

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

Risk Disclosure

The risk of loss in trading financial instruments such as stocks, FX, commodities, futures, bonds, ETFs and crypto can be substantial. You may sustain a total loss of the funds that you deposit with your broker. Therefore, you should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources.

No decision to invest should be made without thoroughly conducting due diligence by yourself or consulting with your financial advisors. Our web content might not suit you since we don't know your financial conditions and investment needs. Our financial information might have latency or contain inaccuracy, so you should be fully responsible for any of your trading and investment decisions. The company will not be responsible for your capital loss.

Without getting permission from the website, you are not allowed to copy the website's graphics, texts, or trademarks. Intellectual property rights in the content or data incorporated into this website belong to its providers and exchange merchants.

Recent Searches

Top Searches

Markets

Analysis

User

24/7

Economic Calendar

Education