Era of cheap crude oil ending, Russia may reduce output; prices will rebound in Feb ’23
时间:2024-06-26 09:23:53 阅读(143)
By Bhavik Patel
Crude oil is riding on the upside momentum as China continues to relax covid measures. China announced this week of a major easing of its Covid travel quarantine rules. Another reason for jump in prices is Winter Storm Elliott knocked offline around 1.5 million bpd of refinery capacity in the U.S. Gulf Coast. Despite the soaring number of infections and disruption to industries and supply chains, oil demand could be set for a major boost in the world’s top crude oil importer after the initial Covid waves. 2023 would see a jump in crude oil demand as China will join other countries in travel relaxation.
The US is now looking to replenish their stock for SPR (Special Petroleum Reserve). US commercial crude inventories, with nationwide holdings, are at their lowest for this time of year since 2014. Why traders are bullish in crude can be seen in the spread of WTI futures. In the physical market, there is 13 cents a barrel backwardation meaning near term prices are higher than later dated ones. One week ago, futures were trading in bearish contago by 17 cents meaning later dated ones were trading higher than near term. This shift suggests supply tightness which is always bullish for the market.
In MCX, price is still trading under 20 and the 50-day moving average but momentum oscillator RSI_14 is at 50 showing a neutral trend. The bottom for the oil market is now in the rearview mirror and we might see prices continue to trade higher from February. January we might see consolidation as prices will digest the rally from 6000 to 6700 and physical demand in China will remain subdued because of the rise in infection. By February we will see the impact of Russian production cuts and rise in demand from China to take prices higher. For next week, expect the price to trade in the range of 6200-6900.
(Bhavik Patel is the commodity/currency analyst at Tradebulls Securities. The views expressed are author’s own.)
上一篇:Stocks struggle as US jobs dry up, kiwi leaps on RBNZ surprise
下一篇:Year of concerts- From Taylor Swift’s Eras Tour To Madonna’s Celebration Tour
猜你喜欢
- Stocks to buy- Ashok Leyland, United Spirits among top picks for July, shares may rally up to 17%
- Tariff cut may boost India’s phone exports to $39 bn by 2027- ICEA
- Budget 2024- Extend all MSME benefits to retail traders, urges retailers’ body RAI
- Stocks rally for second day, Sensex surges 874 points; IT stocks, RIL, HDFC twins shine
- Stock Market Holidays December 2022- BSE, NSE to remain closed on these days next month; check dates
- Boeing 737 Max 9 crisis- Federal officials order grounding of some jetliners after plane suffers mid-air blowout
- Tariff cut may boost India’s phone exports to $39 bn by 2027- ICEA
- Bomb found in train at Karachi’s Cantt railway station, defused
- Stocks to Watch- Adani Enterprise, Tata Motors, Infosys, HDFC Bank, Ksolves India