Crude oil price remains on an uptrend as optimism on the recovery of global oil demand exceeds concerns over the Indian coronavirus variant. To begin with, the reopening of various European economies has heightened hopes of economies recovering and oil demand rising.
On Monday, the UK began the second phase of reopening the economy. For instance, in England, it is now legal to have meetings of 30 people outdoors or 6 people indoors. Restaurants and other entertainment joints can also have indoor setups for their customers. Wales and Scotland have also eased restrictions while Northern Ireland is expected to do so later in the week. Besides, the UK government has permitted international travels under a system that will highlight the red and green-listed countries.
In the US, the recovery in air travel has further supported crude oil price. On Monday, the United Airlines indicated that it would be including over 400 more daily flights in its July schedule.
Investors are also keen on the weekly US oil inventories. API is expected to release its data later on Tuesday while EIA’s figures will be released on Wednesday afternoon. Last week, API’s data showed that stockpiles had fallen by 2.533 million compared to the forecasted decline of 2.250 million barrels. EIA expects inventories to rise by 1.680 million barrels after dropping by -0.427 million barrels in the prior week.
Crude oil price technical outlook
Crude oil price is seesawing around $66 ahead of the US oil inventories data. Earlier in the day, WTI futures rose to $67 before pulling back to $65.50. at the time of writing, it was down by 0.64% at $65.86. On a 2-hour chart, it is trading below the 25 and 50-day exponential moving averages. The bears may retest the prior support level at $64. However, I expect the price to rebound to $66. This thesis will be invalidated by a move below 63.50.