Oil fell to a six-week low following a report that US stockpiles rose last week.
There was an oversupply in the market, which was putting pressure on the WTI. Refineries cut utilisation rates to the lowest level since April last year, and petroleum demand plunged to 17.7 million barrels a day, the weakest level in almost 12 years for the week ended 27 January, according to the US energy department. Even though there are fears of a supply disruption from the Iran oil embargo, in light of the prevailing extreme cold temperatures across Europe currently, Brent should be supported at the $115.0 level.
It is currently trading at $116.6. The next level of resistance should be the $118.0 level, which hasn’t been hit since August last year. A clean break above this level on the back of the resolution of the Greek talks may see Brent rally above $120 a barrel. The 14-day RSI is just over 70, signifying fast-approaching overbought levels. Brent for March delivery is up 0.55%, whereas oil on NYMEX is trading at $98.35, up nearly 1.5% on expectation of a Greek solution soon.