General analysis Brent for 22.03.2022

Current Dynamics

The international rating agency Fitch raised its forecasts for the cost of oil in 2022. Countries in the Middle East begin negotiations with the largest economies in Asia to pay for oil in local currencies.
Published by Fitch Ratings, the cost of Brent crude oil in the baseline scenario will reach $ 100 per barrel in 2022 instead of the previously predicted $ 70, and the price of WTI rose to $ 95 per barrel instead of $ 67. However, the long-term outlook was not revised. It also noted that the demand for oil has almost reached pre-pandemic level, while some countries, such as Saudi Arabia and UAE have enough spare capacity to increase production.
Some countries have already managed to bring oil production to the pre-pandemic level. Argentina has reported the highest production over the past ten years, but it is worth noting that these results were achieved through the use of unconventional production methods.
Europe is discussing the embargo on Russian oil and gas industry, but not all members of the European Union are ready to give up Russian oil. Thus, representatives of the German cabinet Steffen Hebeestreit said that the embargo on Russian "black gold" at the moment is impossible. At the same time a number of lesser countries are not ready to join the anti-Russian sanctions and thus spoil relations with major oil and gas companies in Russia.
At the same time, a number of countries in the Middle East are beginning to consider options for trading oil for national currencies. Thus, against the background of negotiations between Riyadh and Beijing to sell oil for Yuan, Iran offered to supply oil to India in rupees. Iran's ambassador to India, Ali Chegeni, has said his country is ready to support India's energy neutrality.

The number of installed rigs in the US was released last week. According to the report, the total number of rigs in the U.S. was 663, unchanged from a month earlier, while the active rig count was 524, down by three from a week earlier.
The American Petroleum Institute's weekly crude stockpile data will be released today at 22:30 (GMT+2).

Support and Resistance Levels.

Brent opened the trading session on Monday with a upward gap. After breaking through the 50 Fibonacci level the market shifted to correction with following consolidation near the key level. The current trend is upward. The RSI oscillator has moved out of the overbought zone and is below the 70 level.

• Support levels: 109.30,104.15, 101.30, 95.85
• Resistance levels: 131.00, 122.70, 117.70, 113.50

Trading scenarios

• Long positions can be opened above the level of 113.50 with a target of 122.70 and a stop loss of 109.30. Implementation period: 1-3 days
• Short positions can be opened below the level of 109.30 with a target of 104.15 and a stop loss of 113.50. Implementation period: 1-3 days