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Unexpectedly, energy and precious Metals prices took a downturn last week, plummeting below $75 per barrel and reaching lows not seen since July. This development poses a challenge to the anticipated outcomes for Saudi Arabia. The OPEC+ meeting on Nov. 26 holds uncertain outcomes for their desired market balance.
Rising Exports Despite OPEC+ Meeting
While the OPEC+ alliance plans a potential supply adjustment, recent data reveals a seasonal export increase of 180,000 barrels, led by Iraq and Iran.
Speculation in oil purchasing sharply decreased, as noted by energy analyst Phil Flynn, signaling a noteworthy change in market dynamics. Crude futures endured their third straight week of losses, prompting worries about an extended period of decline.
Flynn highlights an unprecedented short oil position, signaling a dramatic shift in market sentiment, possibly influenced by macroeconomic fears rather than supply and demand fundamentals.
Read More: Silver Prices Plunge Amid Powell’s Hawkish Stance and Strengthened Dollar
Market Unease and Global Economic Worries
A resurgence in Treasury yields towards the end of the week contributes to market unease, fueling speculation about potential rate hikes by the Federal Reserve. San Francisco Fed President Mary Daly’s prudent position resonates with apprehensions about a weakening global economy.
Prominent hedge fund manager Pierre Andurand underscores the historic lows in net long speculative positioning in oil futures, reflecting a sustained exit from the crude market.
Energy and precious metals Market Settling Activity
Even with a recovery towards the end of the week, WTI crude traded in New York settled at $77.17, reflecting a 4.1% decline for the week. London-traded Brent crude fared similarly, closing the week down 3.8%.
Technical strategist Sunil Kumar Dixit warns of significant resistance for WTI recovery. Therefore, making attempts below the 200-day SMA at $78.10, with potential challenges at $78.60 and $79.90.
Gold Market Activity
Gold futures on Comex settled at $1,937.70, down 3.1% for the week. Gold’s spot price concluded at $1,938.28, indicating a 2.8% weekly decline.
Analyst Dixit anticipates further declines in spot gold. However, with the 100-Day SMA at $1,926.80 serving as the next crucial support level. Immediate resistance is identified at $1,963.
Natural Gas Movement Affect on Energy and Precious Metals
Closing the week, natural gas futures on Henry Hub settled at $3.033, experiencing an almost 14% decrease. Dixit outlines a correctional wave for natural gas. Thus, eaning on an ascending channel support line of $2.98 and identifying the 100-day SMA at $2.81 as the next support level.
In a week marked by economic uncertainties, energy and precious metal markets face challenges, with oil prices taking a notable hit.
