Oil futures extended losses in early trading after U.S. President Donald Trump stated at the World Economic Forum in Davos that he plans to urge Saudi Arabia and OPEC to lower crude prices. The comments, reminiscent of his previous term’s tactics, weighed on market sentiment and contributed to a decline in crude prices.
US President Donald Trump demanded OPEC lower oil prices and the world drop interest rates in a speech to global business and political leaders and warned them they will face tariffs if they make their products anywhere but the US https://t.co/U7g6Ch0yRq pic.twitter.com/ynEsgGzI1m
— Reuters (@Reuters) January 24, 2025
WTI crude futures dropped to an intraday low of $74.00, before closing at $74.43, marking a significant pullback from the session high of $74.59, as traders priced in potential OPEC policy adjustments. Brent crude futures followed a similar trend, reflecting broader market concerns over supply management.
Trump’s statements have sparked concerns among traders, with expectations rising that OPEC could face diplomatic pressure to increase production.
See also: Dollar Dips Again Amidst Tariff Uncertainty
Market participants are also considering the impact of rising U.S. crude stockpiles and global economic shifts, which could further suppress oil prices.
The technical picture suggests ongoing bearish momentum, with immediate support seen at $74.00. A breach below this level could lead to further declines toward $73.50.
Picture: Crude oil prices hold support near $74.00 after recent drop, as seen on the VT Markets app.
On the upside, key resistance stands at $74.75, with a stronger barrier at $75.50, which aligns with the recent trendline resistance. The bearish crossover on the MACD indicates persistent downside pressure, reinforcing the bearish outlook.
The oil market remains on edge as traders await further statements from OPEC and key economic data releases that could shape price direction.
Any confirmation of increased production by OPEC could lower prices, while a firm stance on maintaining current supply levels might provide temporary support.
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