Crude drifts lowerOil was drifting lower in early trade this morning, taking front-month WTI back down below $70 per barrel. It has lost 10% since it briefly topped $78 around ten days ago, and while the daily MACD has turned sharply lower as well, this move has only taken it back to ‘neutral’ levels rather than the heavily oversold area from this time last month. The concern that Israel would target Iran’s energy infrastructure in retaliation for the latter’s recent missile attack has been completely priced out. This followed Israeli Prime Minister Netanyahu’s statement that the country would only target Iranian military targets in response. This has led to the resumption of selling pressure as traders react to the overarching dynamic driving energy prices. Supply remains plentiful, while agencies such as OPEC and the US Energy Information Administration (EIA) calculate that the market should expect falling demand growth from both China and the US in the year ahead. Added to this is the ongoing switch to natural gas, as well as increased investment in renewables.
