On Wednesday (November 20th) during the European trading session, crude oil prices rose on Wednesday, driven by technical support and intensified geopolitical concerns. With changes in key levels and increasing tensions abroad, traders are closely monitoring signals of potential breakthroughs.

Will geopolitical tensions drive up oil prices further?

Geopolitical risks provide additional impetus to crude oil prices. The tension between Russia and Ukraine has escalated after Ukraine deployed long-range missiles provided by the United States onto Russian territory. In response, Moscow has revised its nuclear principles and warned of nuclear retaliation against conventional attacks involving nuclear allies.

After reports of possible airstrikes, the US Embassy in Kiev was evacuated, exacerbating market tension. Although energy flows remain unchanged, analysts warn that if hostilities escalate, Europe's natural gas supply could face serious disruptions.

Outside of Europe, Iran's ongoing uranium enrichment activities have raised concerns about further sanctions, which could limit the global flow of oil and condensate.

Is inventory data important in this environment?

Due to traders' focus on geopolitical risks, inventory reports have taken a back seat. The latest data from the American Petroleum Institute (API) shows that US crude oil inventories have increased by 4.75 million barrels, far exceeding the expected 1 million barrels. This is offset by the consumption of gasoline and distillate oil.

The US Energy Information Administration (EIA) is expected to release a report later on Wednesday, predicting a reduction of 100000 barrels in US crude oil production. Pessimistic surprises may put pressure on prices, but geopolitical developments remain the main driving factor.

What is the outlook for the crude oil market?

The technological resilience of crude oil and the escalating geopolitical tensions indicate a bullish short-term outlook. However, without an immediate interruption in energy flow or optimistic EIA data, the increase may face higher levels of resistance. Traders should closely monitor key technical positions and geopolitical dynamics to determine market trends.

technical analysis

WTI Crude Oil Daily Chart

Crude oil prices have resumed active trading, testing the resistance level of $70.00 and strengthening expectations of a continued bullish trend for the remainder of today. The road to achieving the first target of $70.58 is open, and prices above this level will extend the bullish wave to $72.15 as the next positive stop. The expected increase will remain effective unless the price falls below $68.64 and remains below it.

The expected trading range for today is between the support level of $68.20 and the resistance level of $71.20.