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(WCTW) A Pause Before We Go Higher

(WCTW) A Pause Before We Go Higher

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HFI Research
Sep 11, 2023
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HFI Research
HFI Research
(WCTW) A Pause Before We Go Higher
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We see a pause in the oil rally in the near term before we move higher into year-end. Our reasoning stems from:

  • WTI is at the pivotal resistance level of $86 to $88. Without a break above this level, the support zone comes back into play ($81 to $82).

  • Global refineries are going into maintenance. Global inventory draws will slow down a bit over the next 6-weeks.

  • Extremely low Saudi crude exports in August are unlikely to be maintained. 

  • Chinese crude buying will slow as the Saudi cut extension announcement gives China the ability to plan ahead.

  • Oil speculators have covered their respective short positions in crude, so a big tailwind from the latest buying will dissipate.

A pause before we go higher...

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