Crude Oil Prices Continue to Surge, Upholding Robust Uptrend

Oil prices continued their bullish trend last week, with Brent crude oil futures on the Intercontinental Exchange (ICE) rallying 6.2 percent to close at $116.72 per barrel. This marks the highest closing price since early June 2022, reflecting a strong upward momentum over the past four weeks. In the domestic market, crude oil (November) futures also posted a significant gain of 4.3 percent, closing at ₹9,800 per barrel, maintaining its positive trajectory with gains noted for four consecutive weeks.

The driving forces behind this price rise include a combination of global supply constraints and robust demand dynamics. Ongoing geopolitical tensions have heightened market volatility, particularly in oil-producing regions. Coupled with this, a recovery in global economic activity has spurred demand, especially in energy sectors. Concerns over potential disruption due to these geopolitical factors are likely to sustain a bullish sentiment among investors and traders, encouraging price increases in the near future.

Short-term outlook remains positive for both Brent and domestic crude oil futures, with indicators suggesting further upward movement. Traders should watch for potential resistance at $117 for Brent, with possible corrective pullbacks to $112 before resuming the rally, potentially hitting $120 and beyond. On the domestic front, a recovery in crude oil futures is anticipated to test targets of ₹10,200 and ₹10,500, with the primary support level established at ₹8,500, providing a safety cushion against significant downturns.

Source: Market Source

(Expert Note: This report was independently prepared by the Wealthova Commodities team.)