Forex. WTI Oil trading forecast and signal for today May 5, 2021
WTI crude oil reached a price value of $65.15 per barrel.
Global markets gained almost 2% on the day. Traders' risk appetite and positive expectations for oil demand support the news about the quarantine in Europe. The European Commission's recommendations to ease restrictions on entry from third countries may be agreed by the end of May, so that they can come into force as early as June. Overall, expectations of an easing of quarantine restrictions support the prospects for economic recovery and oil demand.
Market participants also expect an active automotive season this summer in the United States and Europe, which should support the growth of oil demand. At the same time, the unfavorable situation in India and a number of other Asian countries has a restraining effect on prices. So far, the Indian authorities are trying to limit the introduction of local restrictions to avoid an economic downturn, but some experts are already noting signs of weakening demand for oil in the country.
In addition, the likely lifting of US sanctions on Iran may become a limiting factor for oil prices, which will allow the Iranians to significantly increase production and export of raw materials. Before the introduction of sanctions in 2018, the volume of production in the country exceeded 3.8 million barrels per day, and in the middle of last year, due to the pandemic, it fell to 1.9 million. At the moment, this figure has recovered to 2.5 million, but the growth potential is still there. If the negotiations on the nuclear deal are successful, Iran will be able to increase oil exports, which will partially offset the efforts of OPEC+ to balance the market.
WTI Oil Trading signals for today May 5, 2021
The forecast assumes a decline in the price of WTI oil to the levels of 65, 64.75 and 64.50 USD per barrel.