Brent price fell below $100 on Friday, reversing the large part of Thursday’s 5.5% rally, as sentiment continues to change on daily basis.
Initial fears of longer supply disruption on signs of fresh escalation of US-Iran conflict were faded by talks that the EU countries would release 50 million barrels of diesel from their strategic reserves, with another 50 million barrels to be provided by the members of International Energy Agency.
The measure, although likely with short-lived impact, aims to reduce surging fuel price, as the major shortage is now in supply of refined products, after Russia and China stopped diesel exports and US signaled that may follow, leaving EU consumers exposed and threatening of further destabilization particularly with diesel supplies.
Fresh weakness has dented larger bullish structure as negative momentum strengthened, with weekly close below $100 to keep the downside vulnerable and key near-term support at $95.11 (Sep 30 higher low) exposed.
Weekly action was shaped in Doji candle (after two consecutive weekly losses), pointing to indecision as traders try to assess the situation, before re-entering quite volatile market (geopolitics are expected to remain dominant driver).
Res: 100.00; 101.23; 101.65; 101.97
Sup: 97.67; 96.55; 95.11; 93.94
