General analysis Brent for 09.03.2022

Current Dynamics.

US President Joseph Biden banned the import of any oil from Russia. Oil prices were trading above $131 per barrel.
The U.S. is pursuing a systematic policy of tightening sanctions against Russia because of the conflict with Ukraine. This time President Joe Biden announced sanctions against Russian oil. As clarified by the U.S. Treasury Department, all deals on Russian oil must be completed by April 22, 2022. According to the International Energy Agency, in 2021 the U.S. imported less than 700K bpd, less than 10% of total U.S. imports. However, gasoline prices in the U.S. continue to increase and need to be curbed somehow. The White House has sent a delegation to Venezuela for negotiations, including on U.S. Energy Security. However, the U.S. and Venezuela have agreed only to continue working to define the format of mutually beneficial cooperation.
At the same time, Great Britain announced that by the end of 2022 it would stop importing Russian oil and oil products. The volume of Russian oil from the total volume of imported oil in England is 8%.
Unlike England, European countries are much more dependent on Russian oil. The share of the import of Russian oil products is 27%. Europe cannot so easily give up supplies from Russia. The European Commission has proposed a plan by which the EU countries will be able to refuse oil from Russia by 2030.
However, OPEC does not observe a supply shortage in the oil market, although it notes that oil prices are subject to high volatility due to sanctions imposed on the second largest oil exporter in the world, Russia. Note that OPEC+ countries follow the plan to increase oil production by 400 bpd. Cartel members announce the data on oil production increasing at the beginning of each month. OPEC next meeting will be on March 31. However, US President Joe Biden initiated telephone talks with the leaders of the United Arab Emirates and Saudi Arabia, but according to the Wall Street Journal (WSJ), the talks did not take place.
Meanwhile, the oil crisis is gaining momentum not only in the West but also in the East. Japan is only evaluating the possibility of imposing sanctions on oil products from Russia, while in Japan itself the price of oil rose to its highest level since August 2008. The price of a kiloliter (6.289 barrels) reached 88,000 yen ($759). Because of high oil prices, Economy, Trade and Industry Minister Koichi Hagiuda announced the decision to sell 7.5 million barrels of oil from national reserves and plans to spend 360 billion yen (about $3.1 billion) to stabilize prices of gasoline and other oil products in the country.
Today, Brent crude opened with a gap to the upside and then turned to the downside. The weekly API report showed a build-up of 2.811Mbbl in US crude stocks, ahead of expectations of a 0.833Mbbl decline. Today at 17:30 (GMT+2) the Energy Information Agency (EIA) will publish data on crude oil stocks. Reserves are expected to decline by 0.657M.

Support and Resistance Levels.

After rising, Brent has corrected to the key 50.0 Fibonacci level. The current trend is upward. After the RSI fell below the 70 level, the oscillator approached the 50 level. RSI is in the upper zone.

• Support levels:  117.00, 113.75, 108.25
• Resistance levels: 119.70, 122.30, 125.75, 131.00

Trading scenarios

• Long positions can be opened above the level of 119.70 with a target of 125.75 and a stop loss of 117.00. Implementation period: 1-3 days
• Short positions can be opened below the level of 117.00 with a target of 113.75 and stop-loss 119.70 Deadline: 1-3 days