COVID-19 vaccines trigger oil prices up

0 5

Oil prices started the first trading week bullish. Oil bulls recouped some losses recorded at the previous session amid high hopes that OPEC+ will continue to limit output in order to curb fears on weaker soft demand, coupled with concerns that the COVID-19 pandemic seems to be out of control.

  • At the early session in Asia, Brent Crude futures were up 1.1% and priced at $43.21 a barrel, while the U.S based oil contract, U.S. West Texas Intermediate crude, for December was priced at $40.66 a barrel – up by 1.32%.

READ: Output cut: Nigeria leads in OPEC non-compliance with 50 unsold cargoes of crude

Both oil benchmarks contracts ticked up by more than 8% last week on high hopes of a COVID-19 vaccine, coupled with strong reports from the Organization of the Petroleum Exporting Countries (OPEC) and their allies including Russia, that it will stick to lower output early next year in order to keep energy prices relatively attractive.

OPEC+, in present terms, has reduced oil output by about 7.7 million barrels per day, with a compliance rate seen at 101% in October, greatly attributed to the Saudi Energy Minister, nicknamed “Oil Sherriff” as he battles oil speculators and keeps wary over oil producers.

READ: U.S dollar up, Currency traders focus on U.S election

<!–

onebank728 x 90

–>

GTBank 728 x 90GTBank 728 x 90

OPEC+ is scheduled to hold its ministerial committee this Tuesday, which could elaborate on changes to oil output quotas when all the ministers meet on Nov. 30 and Dec. 1.

What they are saying

With a well-detailed analysis on the black fossil market, Stephen Innes, Chief Global Market Strategist at Axi, in a note to Nairametrics, spoke on the macros oil traders are riding on presently.


<!– /21634543682/234989245

–>

Coronation adsCoronation ads

READ: U.S dollar tumble, Currency traders more risk averse

“All the while, oil prices are still riding the vaccine tailwinds supported by OPEC + backstops, as the two sturdy backstops are ruling out of the more worrying demand and price collapse scenarios.

“Last week traders speculated that the US could move into very rigid lockdowns over the holiday season, impacting road fuel demand over Thanksgiving and Christmas, so we are seeing some of those shorts give way at the open, as traders back some of those US lockdown worries and oil is climbing a bit.”

READ: America’s biggest food delivery app, DoorDash seeks for IPO approval

Bottom line

<!– /21634543682/Zenith_Bank 320×100

Zenith bank | USSD codeZenith bank | USSD code

UCAP adsUCAP ads

UBA ADSUBA ADS

–>

Jaiz bank adsJaiz bank ads

Oil traders are looking for the same trading patterns this week as last week, where optimism around key resistance levels quickly ebbs to pandemic realities. It is hard to escape the current virus realities when it comes to the prompt oil market prices.

<!– /21634543682/23188292 Coronation research 250×250

–>

<!– /21634543682/23188292

PatriciaPatricia

–>

<!–

first bankfirst bank

–>

<!–

Fidelity adsFidelity ads

–>

Stanbic IBTC Stanbic IBTC

Click here for the Source

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More