General analysis Brent for 29.03.2022
Current Dynamics
The U.S. plans to increase oil production by 900,000-1 million bpd this year. Kazakhstan estimated the amount of lost oil due to the breakdown of the Caspian Pipeline Consortium. Japan increases gasoline compensation.
The U.S. State Department's senior adviser on energy security Amos Hockstine said the country plans to increase its oil production by 900,000-1 million bpd, mainly to meet the demand on foreign markets.
Meanwhile, Brazilian President Jair Bolsonaro has expressed his dissatisfaction with the 18-25% increase in gasoline prices from distributors. As a consequence, the president of Brazil has decided to replace the head of the largest oil and gas state company of Brazil Petrobras.
Meanwhile, the authorities of Kazakhstan have evaluated the losses in oil production at 320 barrels per day during the repair of the sea terminal of the Caspian Pipeline Consortium (CPC). According to the CPC press service the repairs will last at least 3-4 weeks.
At the same time, the OPEC+ countries increased oil production by 328 bpd in February. However, under the current plan OPEC+ countries planned to increase oil production by 400 thousand bpd.
According to Suhail Ali-Mazroui, Minister of Energy and Infrastructure of the UAE, OPEC+ alliance will continue, while Russia is an important member of the alliance. It is worth noting the phone conversation between U.S. Secretary of State Anthony Blinkin and Saudi Foreign Minister Faisal bin Farhan Al Saud. During the conversation, the U.S. secretary of state condemned the recent Yemeni Hussein attacks on the kingdom and reiterated the U.S. commitment to strengthening Saudi Arabia's defense capabilities.
Meanwhile, India is increasing its oil imports from Russia. At the current oil prices, it is more favorable for New Delhi to buy Urals oil from Russia rather than from its major partners Iran, Saudi Arabia, UAE and Nigeria. Since the beginning of March, 5 shipments of Russian oil totaling 6 million barrels have been sent to India. Analysts also expect China, the biggest importer of Russian oil, to buy Russian oil at a discount. The discount may reach $30. It is worth noting that during the first two months of the year the growth in high-tech production has increased by 14.4%, while the equipment production has grown by 9.6%.
At the same time, the Japanese authorities are planning to approve by the end of April an extension of current measures to subsidize gasoline selling companies and raise the compensation from 5 yen ($0.043) to 25 yen ($0.22) per liter of gasoline.
The American Petroleum Institute's weekly crude stockpile data will be released today at 22:30(GMT+2).
Support and Resistance Levels.
At the opening of trading on Monday the Brent opened with a downward gap to the 50 Fibonacci level. After a sharp decrease of quotes below the key level of 61.8 according to Fibonacci the quotes returned to growth and fixed above the level of 61.8. The current trend is upward. The RSI oscillator declined to 30 before returning to an upward move to the 50 level.
- Support levels: 104.15, 101.30, 95.85
- Resistance levels: 131.00, 122.70, 117.70, 113.50 109.30
Trading scenarios
- Long positions can be opened from the current level with a target of 109.30 and a stop loss of 101.30. Implementation period: 1-3 days
- Short positions can be opened below the level of 101.30 with a target of 95.85 and stop loss of 104.15. Implementation period: 1-3 days