Oil: Russia-Ukraine Crisis Could Boost Oil Prices
Crude oil futures surged on Monday due to disruptions in Russian refining capacity caused by Ukrainian drone strikes and Moscow's decision to cut output to comply with OPEC+ targets. The West Texas Intermediate (WTI) contract for May settled at $81.95 a barrel, up $1.32, while the Brent contract for May settled at $86.57 a barrel, also up $1.32. Russia instructed companies to reduce oil production to fulfill its OPEC+ commitments, with voluntary cuts totaling 2.2 million barrels per day. A Ukrainian drone attack caused a fire at the Kuibyshev oil refinery in Samara, knocking out a major refining unit. According to British intelligence, Ukrainian strikes against Russian energy infrastructure have disrupted at least 10% of Russia's refining capacity, potentially leading to time-consuming and costly repairs.
XTIUSD - D1 Timeframe
XTIUSD has made an initial reaction off the pivot zone on the daily timeframe, and may slide even further down. This sentiment is based off of the QMR pattern that I have spotted on the 1-hour timeframe, and the 88% Fibonacci retracement level. The primary target here could very well be the trendline support as shown on the chart.
Analyst’s Expectations:
Direction: Bearish
Target: $78.42
Invalidation: $83.53
XBRUSD - H1 Timeframe
XBRUSD made a sharp reversal after hitting the pivot zone on the daily timeframe. Following this, price retested a trendline resistance after breaking below the previous lows, indicating the likely onset of a bearish trend. It is my belief that price would try to close below the most recent low, since failure to do so would imply a change in market sentiment. My final target, however, is the demand zone marked out towards the bottom of the chart.
Analyst’s Expectations:
Direction: Bearish
Target: $83.36
Invalidation: $86.73
CONCLUSION
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