Crude Oil Wave Analysis – There Should Be a Correction

Crude Oil Wave Analysis – There Should Be a Correction

Brent got closer to the $90 per barrel checkpoint closer last week than it was in the past 7 years. Supply shortages, attacks on Saudi oil rigs are considered to be the main drivers of crude oil’s uptrend. OPEC’s monthly oil report highlighted the increasing demand for crude oil this year, yet the organization called to keep the production at current levels.

Hence, the increasing demand with a steady supply motivates the oil price to climb higher. It has also been said that despite Omicron being highly sustainable to nowadays vaccines and being highly contagious, many scientists sealed it as “not dangerous”, which encouraged tourists and travelers to head to a journey. Yet, this variant is not completely studied, we can still expect surprising discoveries.

However, increasing oil prices along with the high pace of rising inflation could cut the demand rapidly. Oil is considered to be the second-largest expense for all airlines, after labor. “Higher jet fuel prices lead to higher ticket prices,” United CEO Scott Kirby told CNBC. Hence, to withhold the oil crisis, OPEC might as well reconsider the production in February.