Jet Fuel Stocks at 7-Year Low, Fare Hikes on the Horizon

Brent fell sharply by 6.2% in the last 24 hours to 97.69, with RSI at 31.4 approaching oversold territory. Jet fuel inventories at a 7-year low and ticket price hikes on the horizon indicate that refined product demand remains strong, which could indirectly support crude oil demand. However, the price is still below SMA20 (99.06) and SMA50 (101.92), MACD is in negative territory and very close to the signal line; this suggests that downward momentum is weakening but there is no reversal confirmation yet. The news could be a catalyst for short-term bargain hunting; there is a possibility of a limited upward correction in 1-3 days. Nevertheless, if strong dollar or supply increase news emerges, the recovery may remain limited.

Jet fuel inventories at a 7-year low and fare increases pose cost pressure and demand decline risks for airlines. PGSUS technical indicators are already weak: price below SMA20 and SMA50, MACD negative, and RSI at 45 in the neutral-weak zone. The news may increase selling pressure in the short term. However, the impact may be limited as the fare increase news may already be priced in and affects the overall aviation sector. Nevertheless, I think downside risk is more dominant.