Oil prices recorded gains on Wednesday trading session on expectations for drop in US reserves. However, the trade remains not particularly active, as the markets prepare for Christmas and New Year holidays. The US light WTI crude rose by 0.47% to 53.55 USD per barrel and the European Brent oil recorded appreciated by 0.61% to 55.69 USD per barrel.
According to traders prices are rising largely because of forecasts that stocks in the US will account decreases. Regular weekly report of the Energy Information Administration will release today the US reserves, which are expected to decrease and keep on downtrend.
The expected decrease will amount to 2.563 million. barrels for the week ended December 16. In the absence of strong fundamentals, traders say technical support and resistance levels will move prices.
WTI prices could increase to 54.37 USD per barrel, after he broke the resistance level at 53.36 USD per barrel.
On Monday, the US President Barack Obama issued a ban on new drilling for oil and gas in federal waters in the Atlantic and Arctic Ocean. Obama has used the law of the 50s of the last century and, according to environmental organizations, the future administration of Donald Trump will have to challenge in court the decision if he wants to repeal it. The ban affects 46.5 million hectares near the coast of Alaska and 1.5 million hectares in the Atlantic Ocean from New England to the Chesapeake Bay.
Even Trump wants to repeal Obama’s decision, only a few companies have expressed their willingness for new wells, as there are plenty of cheap oil shale in North Dakota and Texas.