OPECs meeting is to take place on June 22, 2018 in Vienna, Austria and in our opinion is the center of attention of the oil market.

One of the most important subjects to be discussed is Iran’s request to OPEC to include in the meeting a pardon request from the sanctions the Middle East country is facing.

Previously, Iranian oil minister Mr. Zanganeh, requested OPEC to backup Iran against new U.S. sanctions giving reference to Article 2 of the OPEC Statute, which highlights protection of the interests of member countries independently and collectively.

The above mentioned Middle East issue could be the missing piece to the world’s Oil puzzle that has left market participants guessing why the US has unofficially or indirectly urged OPEC for more Oil supply lately.

By this, they have been able to achieve two significant points. Firstly, they have been able to lower oil prices dropping them from 4 year highs and are now able to bargain on lower prices and subsequently increase their exports of the black gold.

This is also confirmed by their Oil production increasing, which is connected to the increase of oil rigs. Secondly, it is widely accepted that the US is in dispute with Iran and has made various attempts through the years to dismiss the Middle East country completely out of business aiming to diminish its Oil operations with the rest of the world.

Yet, someone has to be able to cover for the Oil coming from Iran and only some countries have the capacity to provide for this supply deficit. If Saudi Arabia is able to cover for this supposedly lost supply, then Iran is left out of the Oil market picture or at least is restricted significantly, which was always the US objective.

In a note contradicting the US objectives, Iran’s Mr. Zanganeh also confirmed the country has plans of intensifying its production and increasing its oil output for the next 3 years.

This output could be derived from the current active Oil fields which are around 30 by working more intensively.

This week, Oil prices tumbled further on Monday, pulled down by increasing Russian production and U.S. drilling activity which was confirmed by financial data and news agencies.

Active Oil rigs in the United States, were seen rising again reaching a total number of 862 indicated by last week’s Baker Hughes rig count.

Most important detail to note is that compared to last year the oil rigs have increased by 121 in total.

In the meantime, Russian news agency Interfax confirmed on Saturday that Russia’s oil production, had risen to 11.1 million bpd in early June, 0.1 million bpd up from slightly below 11 million bpd for most of May.

Please note this number is well above Russia’s target output of under 11 million bpd as part of the deal they have with OPEC.

Pressured by falling demand from China and increased U.S. output Oil prices fell in the previous sessions.

Despite that, in China automobile purchases were up in May compared to May 2017 by almost 10% and this indicates that oil demand could grow in the coming months.

In India, the commodity’s demand increased by 3.4% in comparison to May 2017.

As a conclusion, oil supply deficits still create worries within the oil market participants and at the same time support prices.

Additional declines coming from Venezuela and Iran have not yet been confronted completely by OPEC and are seen as pending.

Crude Oil has been stable for more than a week, but further actions to cover the above mentioned matters could turn into a market mover.

Technical Analysis on WTI Crude Oil Market

It must be noted that Crude oil has not broken a single support nor resistance level since our report sent last week 6th of June.

Crude Oil has been moving in a sideways manner between the $66.13 (R1) resistance level and the $64.95 (S1) support level.

This could also be the case for the coming week as our support level near $65 is seen to be very strong and has been tested various times in 2018.

Crude Oil could show some reaction on the upcoming OPEC Monthly Report to be released tomorrow 12th of June.

If the bulls are set free we could see crude oil moving upwards towards the $66.13 (R1) resistance level and even breach it aiming for the $67.20 (R2) resistance hurdle.

On the flip side, the commodity could be overtaken by a bearish movement causing it to move down towards the $64.95 (S1) Support level and break it, moving further near the $63.26 (S2) Support barrier.