Charts suggest oil could rise temporarily and then move lower

CNBC’s Jim Cramer said on Wednesday that oil prices could rally in the short term, but it’s unlikely to last.

“The charts as interpreted by Carley Garner suggest that oil could rise in the short term, but over the next few months she ultimately sees it falling – potentially much lower. That’s exactly what the [Federal Reserve] must see [to tamp down inflation]’ said the Mad Money host.

OPEC+, a group of OPEC and non-OPEC partners, said last week that it stands by its planned oil production increase in August and opposed calls for even more production increases to help drive down global crude prices to contribute.

Garner believes OPEC realizes that world demand for oil is being destroyed and believes the world economy can no longer sustain $100 crude oil, according to Cramer.

To begin his explanation of Garner’s analysis, Cramer first examined the monthly chart of West Texas Intermediate Crude.

Garner predicted oil would return to levels before Russia’s invasion of Ukraine and suspected that had it not been for the war, it would have struggled to break above the low $90, Cramer said.

Garner believes crude has already returned to its historic trading range and wouldn’t be surprised if a further drop below $90 helps prevent a dip back to $60, Cramer said.

“Wherever the oil may go, Garner is confident it’s going to be a wild ride,” he said.

For more analysis, watch the full video of Cramer’s statement below. Charts suggest oil could rise temporarily and then move lower

Drew Weisholtz

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