Oil slips after another bright start Oil started the day on the front foot but slipped as the US open approached and have been lower since. It’s been a remarable rally for crude in recent months, with OPEC+ giving it one final push last week after deepening cuts, thanks largely to Saudi Arabia. The decline came just as WTI hit its highest level in around a year, which may have contributed to some profit taking. Near-term risks remain for oil markets, with Covid causing huge problems in many countries which means we’re likely to see more restrictions for longer. The action from OPEC+ may limit the downside but a little profit taking may kick in soon enough. Gold flat as yields pull back Gold … [Read More...]

Oil pares gains as lockdowns become more severe New and extended lockdowns may be taking their toll on broader risk appetite today and it may have taken the edge off oil prices which appeared to be continuing their impressive late 2020 run into the new year. The lockdowns are becoming more severe which is going to naturally take its toll on demand, the difference this time being that the end is in sight and OPEC+ has its house in order. Even if the group raises production by 500,000 barrels in February, I don’t expect the market will sink in any significant way, but we know the sway Saudi Arabia has. An increase of that magnitude is in no way guaranteed. Gold eyeing $2,000 Gold burst through $1,900 to … [Read More...]

Oil higher on Europe rolls out vaccines Crude prices edged higher as the EU’s mass vaccination campaign begins and as risky assets across the board benefit from President Trump’s signing of the stimulus package.  WTI crude should struggle to break above the USD50 level as next week’s OPEC+ meeting next week should be a tense one.  Lockdown efforts have mostly been intensified but that is not preventing the Russians from pushing for output hikes in February. The crude demand outlook appears to be intact despite a new virus strain, which appears will not derail the current vaccine rollouts. Thin trading conditions should see oil prices consolidate for the rest of the week, but risks for a dollar rebound and nervousness ahead of next week’s OPEC gathering could … [Read More...]