Last week the downtrend on the crude oil market was continuing. The prices of WTI futures dropped 5% to $39.69/bbl. On July, 21, the price of WTI was remaining at its weekly high, but in early August it dropped to its weekly bottom of $41.91. The price is fluctuating near its important support level of $40/bbl; however, if the price breaks this level, it would go down to $35/bbl.
The price of Brent crude lost 3% last week and reached $41.91/bbl. The attempt of a correction of the downtrend, made on July 29, failed, and the price went down to its support level of $41/bbl. We still consider the range of $41-42/bbl as a support level for Brent.
Commercial oil stocks in the US decreased by 1.67m bbl, while the market expected a decrease of 2.26m bbl. Baker Hughes reported that the number of active drilling rigs rose only by 3 units. We believe that this data had a negative impact on the crude oil prices along with the uncertainty about the interest rate hike in the US.
We expect the prices of Brent and WTI next week at the range of 38-43 bbl.