Weekly Oil Report: A Surprise for Crude Traders

Crude started disappointingly in August due to the resurgence of Covid in more regions and tensions in the Middle East. Brent closed at $69.94 and WTI fell to $67.97 on the Friday session. The price is showing resistance to $70 prices. Technically, the price of crude is at a critical point which may see lower prices if it drops under $68. The former rising trend of oil seems to be changing; therefore, traders must observe the market news cautiously during the week. Covid cases are rising more than before. The quick outbreak has brought negative sentiments to the markets. The former hike of crude was focused on the expanding demand in countries. The resurge of the virus has faded hopes for more demand. Traders are worried about a potential demand loss by the increasing cases of the disease in major economies. The demand will decrease in case of new travel restrictions. Despite the covid resurge in many regions, the governments have not imposed any new policy. The US reports on the unemployment rate and the hourly wages were highly promising on the first week of August. The non-farm payrolls of July was also above expectations. The Federal Reserve still believes that inflation is rising reasonably, and it needs to go further. Tensions rose in the Middle East after the drone attack on the oil tanker Mercer Street. The US and Israel blamed Iran for the attack and a conflict shaped among the countries. The market is waiting to see what happens in the coming weeks.