US oil prices increased during the week as recent supply disruption fears eased.
USOIL – Weekly Chart
USOIL trades ahead of $74 and will now look to target $80. Resistance on the weekly chart will come around the $82.50 level with a downtrend resistance line.
The price of oil was still affected over the weekend as tensions existed in the Middle East following Houthi attacks on Red Sea tankers. Another development was Angola’s decision to leave OPEC, which raises questions about the group’s ability to support prices.
US crude futures rose by 81 cents above $74.70 a barrel and closed up 5% for the week after the Red Sea attacks and potential disruptions to shipping operations. More oil carriers are now avoiding the Red Sea route due to recent attacks by the Houthi militant group, which says it is responding to Israel’s war in Gaza. The attacks have disrupted trade through the Suez Canal, which handles around 12% of worldwide trade.
The United States launched a multinational operation to protect the Red Sea, but militant groups said the attacks would continue.
Angola’s oil minister, Diamantino Azevedo, said the country’s membership of the OPEC group was not serving its interests. The country produces around 1.1 million barrels per day (bpd), compared with 28 million bpd for the group. However, the exit raises questions about other countries in the cartel. Angola was against OPEC’s decision to cut its production quota in November to help boost prices.
The events helped to offset record levels of US crude output, which hit 13.3 million bpd last week, up from an all-time high of 13.2 million bpd.
