Brent Crude Prices Show Long-term Bearish Trends

Oil prices experienced a slight decrease on Thursday after reaching their highest levels in several months the previous day. Brent crude fell to $81.66 per barrel, while U.S. West Texas Intermediate (WTI) crude saw a decline to $79.69. This drop followed a significant increase on Wednesday, which was driven by a reduction in U.S. crude stockpiles and the introduction of new U.S. sanctions against Russian oil.

The latest report from the U.S. Energy Information Administration highlighted a surprising two million-barrel decrease in crude inventories. This shift tightens the outlook for global supply, as key customers of Russia seek alternative sources. In response, the Biden administration has enacted additional sanctions targeting Russia, which have raised shipping costs and heightened supply concerns.

Despite the recent price increases, it is anticipated that OPEC+ will remain cautious about boosting production. The organization has encountered difficulties in maintaining stable market conditions throughout the past year. On the demand front, global oil consumption showed a slight increase at the beginning of 2025, driven by more travel related to festivals in India and Lunar New Year celebrations in China. Investors are also keeping an eye on potential U.S. interest rate cuts in 2025, which could enhance economic activity and increase energy demand.

Market Analysis of Brent Crude

When evaluating market trends, it is essential to understand that a break in market structure is often succeeded by a retracement—a concept currently applicable to the daily chart of Brent crude (XBRUSD). The retracement is nearing a crucial Fibonacci level, where it intersects other factors including trendline resistance and the Fair Value Gap (FVG).

Price Dynamics on the 4-Hour Chart

Analysis of the 4-hour chart reveals that price movement is currently within an ascending channel as it approaches a supply zone. This zone coincides with trendline resistance and the important Fibonacci retracement level. While a bearish reaction is expected from this confluence, a safer approach would be to wait for the price to break below the trendline support of the channel, ensuring a more secure entry point for traders.

Analyst’s Forecast:

• Direction: Bearish
• Target: 71.32
• Invalidation: 87.64

Oil, Bearish, Analysis