General analysis Brent for 20.04.2022

Current dynamics

The International Monetary Fund raised its forecast for the global average price of oil in 2022. JPMorgan predicted an increase of Brent prices to $185. China has cut gasoline and diesel prices for the first time this year. 

The International Monetary Fund (IMF) raised its forecast for the average price of oil in 2022 from the previous $77.31 to $106.83 a barrel. At the same time, the IMF forecasts an average oil price of $92.63 per barrel in 2023.

Meanwhile, according to OPEC, Venezuelan oil production in March has declined 7.6% compared to February. That means that Caracas produced 728 thousand barrels of oil per day in March, while in February it was 788 thousand barrels per day. So, the daily oil production in Venezuela in the first quarter of 2022 decreased by 7% compared to the fourth quarter of 2021, when the daily production was 817 thousand barrels.

It’s worth noting that Truckers in Paraguay are planning to block roads in several parts of the country after the abolition of fuel subsidies for the state oil company Petropar.

Meanwhile, JPMorgan has predicted an increase in oil prices to $185 if Europe imposes an embargo on Russian oil supplies. According to the bank’s calculations, a complete refusal could cut oil supplies for more than 4 million barrels a day, which would increase Brent price about 65% to $185 a barrel of oil.

Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman Al Saud had a phone conversation last week. Putin and the Saudi prince praised Moscow and Riyadh for working together in the OPEC+ format to ensure stability in global oil prices. As the Kremlin noted, the two sides have expressed their mutual desire to further develop mutually beneficial ties between Russia and Saudi Arabia.

At the same time, Iraqi Oil Minister Ihsan Abdul Jabbar said that his country was under pressure to increase oil production outside the OPEC deal.

We should remind that in March Iraq recorded its largest net profit since 1972 and supplied over 101 million barrels of oil abroad.

Meanwhile, according to China’s National Development and Reform Commission, gasoline prices will be reduced by 545 yuan (about $85.3) and 530 yuan per ton of diesel starting April 16. Which is the first reduction in fuel prices in the Middle Kingdom this year.

Support and resistance levels.  

According to the American Petroleum Institute (API) weekly crude inventories decreased by 4.496M while experts predicted a 2.533M increase.

The Energy Information Agency (EIA) will release data on crude oil inventories today at 17:30 (GMT+2). A decline in stocks by 0.976M is expected.

• Support levels: 106.60, 103.45, 98.30
• Resistance levels: 120.10, 114.95, 111.75, 109.20

Trading scenarios

• Long positions can be opened from the current level with a target of 111.75 and a stop loss of 103.45: Implementation period: 2-4 days
• Short positions can be opened below the level of 103.45, with a target of 98.30 and stop-loss 106.60: Implementation period: 2-4 days