WTI falls back under $100 with Russo-Ukraine peace talk optimism, crude oil reserve releases in focus

Oil was trading with a bearish bias on Friday amid Russo-Ukraine peace talk optimism and crude oil reserve release focus. 

WTI dipped below $100 per barrel and hit fresh weekly lows sub-$98.00, with bears eyeing March lows in the $93.00s.

Oil prices have continued to trade with a bearish bias on Friday, with front-month WTI futures dipping to fresh weekly lows under $98.00 as traders digest the recent announcement of a major crude oil reserve release in the US (1M barrels per day for six months) and a further tightening of lockdown measures in major Chinese economic zone Shanghai. Recent positive commentary from Russian Foreign Minister Sergey Lavrov regarding progress in Russo-Ukraine peace talks is also weighing on oil as geopolitical risk premia is further unwound. Having found resistance at its 21-Day Moving Average (DMA) in the $108 area earlier in the week, WTI is now probing its 50DMA to the downside in $98.00s.

International Energy Agency member nations recently commenced a meeting and the speculation is that other major oil consumer nations might also announce crude oil reserve releases alongside the US. US President Joe Biden said this could amount to a further 30-50M barrels of immediate supply. If confirmed, further newsflow pertaining to crude oil reserve releases could inject further bearishness into crude oil markets, with a test of March lows in the $93.00s on the cards.

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