The surge in prices resulting from the paralysis of Saudi production, hit in its heart by an attack of drones claimed by the insurgents, will have been only of short duration. Aramco’s teams quickly returned to a standardized level of crude oil production, imputed at 6% worldwide. In other words, the increase in oil prices has only been fully and completely retraced in ten sessions.
While the geopolitical situation in the Middle East remains tense, it seems clear that it remains focused on the concerns related to global demand for crude oil. Macroeconomic indicators on both sides of the Atlantic are falling, reflecting the image of the ISM Manufacturing Index which emerged at 47.8, indicating a contraction in industrial activity. Pessimism therefore prevails in the short term and operators seem insensitive to the decline in OPEC production, which has fallen to an eight-year low.
Technically, on a daily basis, prices return to test the major support located in the 57-58 USD zone. This one will have to mobilize buyers under penalty of assisting; an extension of the decline towards the next relevant levels, at 53 USD.