USOil comes from seven straight losing weeks and its worst streak in five years, largely fueled by demand fears and strong non-OPEC production. The International Energy Agency (IEA) had warned last month that the oil market "could shift into surplus at the start of 2024" . The latest poor inflation report from China meanwhile, highlight the difficulties that the world's biggest oil importer faces, whereas the International Monetary Fund (IMF) expects slower GDP growth in 2024, compared to the current year. 
Reacting to the falling prices though, Saudi Arabia, Russia and other OPEC+ members announced additional supply cuts of 2.2 million barrels/day for the first quarter of 2024. Although these were unable to contain the price slump, they could help prevent a surplus. Moreover, the US Energy Department announced on Friday that it looks to buy up to 3 million barrels of oil, to replenish its Strategic Petroleum Reserve (SPR).
The SPR news helped USOil find some reprieve, while market optimism for rate cuts by the Fed and the ECB can also provide support. Although it may get a chance to push towards the EMA200 (77.00), it does not inspire confidence for a meaningful recovery at this stage and the upside contains multiple roadblocks. The recent losing streak has exposed USOil to the 2023 lows (63.63), but sustained weakness below it has a higher degree of difficulty. Its trajectory can be shaped by this week's US CPI data and the central bank blitz.
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.
With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.
Retrieved 11 Dec 2023 https://www.iea.org/reports/oil-market-report-november-2023