Oil is above $60 per barrel, after two weeks of the price falling to $58.5. The uptrend was under threat of completion, but Saudi Arabia quickly reacted on the decreasing and decided to reduce the volume of oil extraction by 100,000 barrels per day, and as of March to sell no more than 7 million barrels. The UAE Energy Minister revealed the preparations of a new long-term agreement with OPEC to limit oil extraction further. Therefore, oil came above $60 in price, also receiving support due to conflict in the Middle East.
At the same time, it should be noted that oil continues to be under pressure due to the growth of oil extraction in the United States, where over the past few years the volume of oil extraction has significantly increased, surpassing the leading countries in OPEC. In addition, a dollar strengthening negatively impacted the oil's value because the calculations for oil futures are carried out in USD, so traders have to spend more if the dollar is expensive.
The stochastic oscillator indicates an overbought area. Despite a number of positive factors for oil, it is likely that oil will continue its drop under the influence of the above-mentioned negative factors. Therefore, short deals in the short term seem more effective. The support line may slightly shift down, but the trend will stay upward in the near future.
