Trading position (short-term; my opinion; levels for crude oil’s continuous futures contract): Since we reached our target of $68.2, my position is to wait and watch for a few trading sessions.

Oil prices are keeping their peak levels – higher than the ones before the pandemic – on account of consistent rising demand and restricted supply of oil from OPEC+.

Oil Market: Key Updates

• EIA crude inventory report will be out today before lunchtime. Bigger than expected inventory drop could take prices even higher.
• OPEC+ policy on oil supply boosting was evident when at the St. Petersburg forum Saudi Energy Minister Prince Abdulaziz said: "There will always be a good amount of supply to meet demand, but we’ll have to see demand before you see supply."
• On Wednesday morning (Jun. 2), a major oil refinery in Tehran was engulfed in a massive fire only hours after the Islamic Republic's largest warship caught fire and sank in the Gulf of Oman under mysterious circumstances.

The market is still bullish, and we may see some more upward action in the coming weeks. However, entering the market is currently risky, and a better entry point can be awaited.

Note: Our trading positions changed since we successfully hit the target.

Thank you.

Nishant Jain, MBA, CPSM
Oil Trading Strategist