Brent Falls Below $100, Erasing Ukraine War Gains

Crude prices have erased most gains since the start of the Russian invasion of Ukraine.
Lockdowns in China weigh on demand expectations.
China’s financial hub Shanghai reported a record more than 25,000 new infections during the weekend.

POSSIBLE OIL TRADING STRATEGY:
IF YOU ARE BIG RISK TAKER ON DAILY CHART :TAKE THE TREND! DONCHIAN 20,25and30 has been broken:Also the important pychological level and Golden Number 100! First target for Short seller could be 94,86,74 and 64 USD.
If You are Intraday Trader, Ue VWAP-Power and trade that blackgold only below. Trail your top or close each position before the Day-Close. But always remember: Long Termwe will see again 200-250USD in Oil, but as Traders important i right now and not what will be happened in 2,6or 12 Months.
Live today to trade better tommorrow. Your capital is the blood of your trading business.

Oil prices dipped by more than 4% early on Monday, with Brent falling below $100 a barrel, as COVID-related lockdowns in China weighed on demand expectations, while the coordinated massive release from oil reserves eased fears of supply shortages.

As of 8:05 a.m. ET on Monday, WTI Crude was down by 4.80% at $93.59, and Brent Crude was trading down by 4.50% at $98.18.

Short selling is un-American. It is done by rogues, thieves, and especially
pessimists, who are, of course, the worst of the lot. It is a terrible, terrible
thing and must be stopped in our lifetime. We should halt it, restrict it, or
at the very least revile those who make it their vocation.
The above sentiments are sadly not imaginary or rare. Rather, they
genuinely reflect much of the investing public’s view of short selling. In
fact, attacks have included proposals to make short selling harder (the
existing “uptick rule” already makes it hard), or to make it impossible by
banning it outright (presumably along with pessimism itself, and perhaps
the infield fly rule). These criticisms and draconian proposals all increase
in volume and seriousness when the stock market goes through a tough
time. At such times many claim short sellers are the cause of the market’s
decline. Finally, at the low point for stock prices, many members of Congress invariably reexamine whether shorting should be allowed, or more
simply, consider just legislating that the Dow go up 50 points a day.
Of course, the media does not help. A rising stock market is a good
thing for ratings and circulation. This country is, of course, biased
toward rooting for stocks to go up, and people watch and read more
about this stuff when it is fun (i.e., going up). Thus, short sellers, with
their gloomy attitude, are not generally media friendly. In fact, even
some pro-free enterprise media outlets sometimes throw away their laissez faire stance when it comes to short selling, particularly “in times of
crisis” (defined as an overvalued market getting a bit less overvalued).
Apparently, they have some confusion regarding the difference between
supporting a free capital market versus supporting an expensive one.
Well, to sum up the theme of this foreword, opponents of short selling are not merely wrong. They are incredibly wrong, both factually and
morally. Short sellers are among the heroes of capitalism and we owe
them our thanks not our opprobrium. The opponents of short selling
are either exceptionally economically challenged, or run to a natural
tendency to ban anything they do not like. There’s a word for the political system favored by people like that and it is not democracy (but does
rhyme with Motalitarianism).

Oil prices have now erased most of their gains since the start of the Russian invasion of Ukraine, after a month and a half of extremely volatile trading in which market participants have trimmed their positions in the crude oil futures.

Oil hasn’t been this low since the middle of March. Early on Monday, the continued lockdowns in China—which is fighting its worst outbreak in two years with its zero-COVID policy—were still a source of concern for the oil market, which is apprehensive of the outlook on demand in the world’s biggest crude oil importer.

China’s financial hub Shanghai reported a record more than 25,000 new infections during the weekend. One of China’s wealthiest cities, with 26 million residents, has been under lockdown for more than a week under the Chinese “zero-COVID” policy, which could weigh on fuel demand. Authorities started easing some restrictions on Monday, as residents became increasingly frustrated with the policy.

“Weaker domestic demand suggests we should see refiners cutting operating rates, whilst there is also the potential that we see a pick-up in refined product exports from China in the short term,” ING strategists Warren Patterson and Wenyu Yao said on Monday.

Moreover, the weakening prompt time spreads in the crude oil futures structure suggest that the physical market is not as tight as what was perceived a few weeks ago.

“There are also indications that the market is looking less tight. The physical market has seen further weakness recently, whilst the prompt ICE Brent time spread has come under significant pressure in recent weeks,” ING’s strategists added.

Citi: Fears Of Oil Supply Shortage Are Exaggerated, But…
Citi: Russian supply loss could be lower than feared.
Citi's Ed Morse: COVID lockdowns in China help lower demand.
The world will have more than enough oil in coming months according to Citigroup analysts.

The world will have more than enough oil because the Russian supply loss could be lower than feared. But it will also have enough oil simply because demand growth could slow down with higher prices and COVID lockdowns in China, analysts at Citigroup say.

“Even as Russian production slides and OPEC+ actually reduces total flows to markets, a slowdown in global growth is reducing oil demand growth, and the IEA release of 220mln barrels of oil between now and October point to market weakness and inventory builds ahead,” Citi analyst Edward Morse said in a note carried by Proactive Investors.

Moreover, Citi believes that the fears of a loss of up to 3 million barrels per day (bpd) of Russian oil supply are exaggerated.

“Of 1.9-m b/d of European seaborne exports of crude oil, around 900-k b/d is being pushed to other markets such as India or will likely stay in some European markets with limited access to non-Russian oil,” Citi’s analysts wrote.

Therefore, the world will have more than enough oil in coming months, the analysts noted.

“Without a deeper Russian cut, which is possible, the numbers add up to much more than enough oil,” according to Citi.

Citi’s view is contrary to other analysts and investment banks which see severe constraints in oil supply.

Commodities have room to soar by another 40 percent on top of the gains in recent months, as investors could pour more money into raw materials as a hedge against the highest inflation in 40 years, JPMorgan Chase & Co says.

There is “absolutely” a supply problem in the oil sector, Jeff Currie, global head of commodities at Goldman Sachs, told Bloomberg on Wednesday.

There are broad-based supply constraints in oil producers, particularly non-core OPEC, Currie said. Every producer except for Saudi Arabia and the UAE is producing less today than they were in 2020, he added. Throw in the Russian shock, and the supply constraints are the most severe in decades, since the 1970s, according to Currie.

The record release of U.S. Strategic Petroleum Reserve (SPR) “is still insufficient to be able to deal with the scale of the problem,” he noted.


FinalThoughts:THE TREND IS YOUR FRIEND! AND ALWAYS USE STOPS!ALWAYS!