Where will the maddening oil price rally end?

The effect of over one hundred days of the Russian-Ukrainian conflict is, among other things, the long-unseen volatility that has been accompanying market participants since February. This variability is particularly noticeable in the raw material market - the price of oil in the last 16 weeks it has increased by over 30%! While the current levels are still far from the historic highs on the oil chart, questions are increasingly being heard in the media space about the end of the maddening oil price rally. 

Despite the EU embargo on Russian oil, Moscow remains the main supplier of this raw material to Europe. Although the head of the European Commission, Ursula von der Leyen, assured that the agreement reached would reduce the import of Russian hydrocarbons to the EU by as much as 90%, the announced embargo is to apply only to oil transported by sea, and several countries - including Hungary and Slovakia - have be excluded from the new regulations. The situation on the crude oil market is also complicated by the fact that US stocks of this commodity are at the lowest levels in five years, while the cartel OPEC +so far, it does not extract any more. 

The next hot months for oil

Expensive oil is not only a problem for drivers - although it is usually car owners who closely follow the situation at gas stations. However, expensive fuel means more expensive transport, and this may translate into an increase in the prices of most consumer goods. In the realities of high inflation, the rise in prices of such economically needed commodity as oil plays an even more significant role. 

However, it seems that inflation expectations reached their low at the end of May, which suggests that global prices may already be reaching their peak. Although the market still expects increases - even up to USD 140 per barrel - the analysis of the two previous oil price rallies (including during the Persian Gulf conflict) suggests that we are potentially close to their end. 

Where the oil price rally will end

On Tuesday, June 14 at 14 p.m. Michał Stajniak will conduct an open live meeting during which the current situation on the crude oil market will be discussed. The XTB analyst will present the fundamental and technical factors influencing the price of this raw material and will present forecasts of its future changes. 

Join the meeting and find out:

• How much can oil prices rise further?
• What is the fundamental situation in the oil market?
• When can we expect profit taking?

About the host

Michał Stajniak

Michał Stajniak - Commodity Markets Analyst at XTB. It places particular emphasis on the linkages between the behavior of commodity prices and the currencies of economies heavily dependent on exports of goods such as oil, iron ore, gold and powdered milk. He is the author of frequent comments comparing commodity price indices with currency pairs such as AUDUSD, NZDUSD, USDCAD, USDNOK or EURNOK. He represents XTB in the media (including TVN24 BIS, Polsat News, TVP Info, Bankier TV or Onet TV) and is the author of articles in the financial press such as Parkiet, PulsBiznesu and Dziennik Gazeta Prawna. He is a practitioner of the stock market and the derivative market. In his approach, he values ​​fundamental analysis above all, but often uses Fibonacci levels to determine the demand and supply zones needed in a Price Action strategy. A graduate of Quantitative Methods in Economics and Information Systems at the Warsaw School of Economics.

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