FreepikCrude oil prices remained under intense pressure this week even as the crisis in the Middle East escalated. Brent, the global benchmark, retreated to $76, down from a peak of $95.90 in September. Similarly, West Texas Intermediate, the American benchmark, dropped to $70.25. Supply concerns remainThe main reason why the price of WTI and Brent crude oil have retreated recently is the ongoing supply concerns. OPEC+ members have disagreed on supply cuts, pushing Angola to leave the cartel. In all, the cartel agreed to voluntary 900k barrel cuts per day, which analysts believe is not enough.Non-OPEC members have also continued to pump record volumes of oil. In the US, oil companies pumped record volumes of oil per day. The average weekly production surged to a record 13.3 million in December. Analysts believe that American companies will continue boosting oil production this year.Other countries are also expected to continue hiking production. For example, Venezuela is expected to boost production to 880k barrels per day this year and to 963k in 2025. The same is true for places like Guyana and Brazil.Therefore, the question is whether demand will rise at an equal pace. Recent reports by the likes of OPEC and IEA shows that demand will still rise but at a slower pace. IEA believes that oil demand will rise by 2.4 million barrels while OPEC sees it rising by over 2.46 million barrels. Therefore, there is an elevated chance that the oil industry will move to a surplus this year.The other reason why Brent crude oil price could continue falling is Russia, which has continued to sell millions of barrels of oil per day. It is selling these barrels to Asian countries like India and China. Recently, however, data shows that India’s crude imports from Russia slumped in December. Brent crude oil price forecastOil chart by TradingViewTurning to the daily chart, we see that the Brent oil prices (BNO) continued falling this week as concerns about supply rose. The chart shows that oil has formed a death cross, where the 200-day and 50-day Exponential Moving Averages (EMA) cross each other. In most cases, this pattern is one of the most bearish signs in the market.The Relative Strength Index (RSI) has also drifted downwards in the past few days. Therefore, the outlook for oil prices is bearish, with the next level to watch being at $71.50, the lowest level since March. A break below that level will open the possibility of the stock falling to $65. More By This Author:Here’s Why The Maersk Share Price Is Ready For Take Off
Rivian Stock Tanks On Decline In Deliveries: Buy The Dip?
Gold Outlook In 2024: Is Geopolitical Demand Overshadowing Fed Policy?