Oil prices are jumping higher throughout the week as the Red Sea attacks fuel fears of disrupted supply chains. On Monday, a vessel was attacked by missiles coming from Houthi rebels, making the passage in the Red Sea to the Suez Canal unsafe as a travel route. All big freight shipping companies have deviated their fleet away from the Red Sea, taking the much longer road around Africa, making it more expensive and diesel-consuming to get goods where they need to be. Meanwhile, the US Dollar (USD) is unable to benefit from the safe-haven inflow, with markets focusing on the quick solutions delivered. Instead, the Greenback is stuck with markets being clueless about what to do with all comments from Fed speakers that are pushing back against early rate cuts expectations from markets. From a technical point of view, trading volumes are starting to die down ahead of Christmas. (WTI) trades at $74.70 per barrel, and Brent Oil trades at $79.90 per barrel at the time of writing.
Oil News and Market Movers: Demand to pick up
Oil Technical Analysis: The longer this takes, the higher the Crude will goOil prices are soaring higher as problems mount in one of the most important areas for global trade. The Red Sea and Suez Canal will see substantially less passage as all big shipping firms are sending their fleet around Africa, awaiting the US-led task force to be operational. Meanwhile, demand for Crude will likely jump, with market participants afraid to fall without supply as longer routes now need to be factored in for delivery.On the upside, $74 got broken and tested for support, offering more upside. Once through there, $80 comes into the picture. Although still far off, $84 is next on the topside once Oil sees a few daily closes above the $80 level. Below $74, the $67.00 level could still come into play as the next support level to trade at as it aligns with a triple bottom from June. Should that triple bottom break, a new low for 2023 could be close at $64.35 – the low of May and March – as the last line of defense. Although still quite far off, $57.45 is worth mentioning as the next level to keep an eye on if prices fall sharply. (Click on image to enlarge)US WTI Crude Oil: Daily ChartMore By This Author:USD/CAD Rebounds From Multi-Month Low, Upside Potential Seems Limited Pound Sterling Tumbles On Soft UK Inflation Data US Dollar Index Price Analysis: Attempts To Retrace Its Recent Losses, Trades Near 102.20
