What's Affecting Oil Prices This Week? (March 20, 2017) Stratas Advisors Monday, March 20, 2017 - 10:55am Log in to post comments Email this page Before the beginning of last week, Stratas Advisors forecast that the price of Brent crude would continue to be under pressure with support at $50.90. The forecast was based on the expectation that oil traders would continue to reduce their net long positions.Further downward pressure was expected from increasing geopolitical tensions in Asia stemming from the provocative actions of North Korea, and in Europe stemming from the growing concerns about Turkey. The downward pressure was expected to be partially offset from the strengthening of demand.The firm’s forecast aligned with the actual price movement. The price of Brent crude started the week at $51.37 and then fell to $50.92 on March 14. The price rebounded in the second half of the week to close at $51.76.The rebound in the price of Brent crude was the result of a positive weekly report from the Energy Information Agency (EIA). The report indicated that during the week before, inventories of crude oil in the U.S. declined by 237,000 barrels, which goes against the normal trend of increases in crude inventories during this time of year. The inventory situation with respect to refined products was also supportive of the oil price. Inventories of gasoline decreased by 1.565 million barrels (MMbbl). Inventories of distillate fuel oil decreased by 4.229 MMbbl. Stratas Advisors also forecast that the Brent-West Texas Intermediate (WTI) differential would continue to trade between $2 and $2.50 with respect to the May contract, which also aligned with the actual results. The Brent-WTI differential started the week at $2.34 then widened to $2.57 on March 14 before narrowing slightly through the remainder of the week to close the week at $2.45.For the upcoming week, Stratas Advisors forecasts that the price of Brent crude will trade sideways with support at $50.90. It also expects that the Brent-WTI differential will continue to trade between $2 and $2.50 with respect to the May contract.