Investing

Oil Up, but Concerns Remain on Recent Rally’s Speed and Scope By Investing.com

© Reuters.

By Gina Lee

Investing.com – Oil was up Wednesday morning in Asia but was down from its recent multi-year highs, as technical indicators signaled that the black liquid’s rally went too far and was too fast.

rose 0.67% to $67.63 by 8:51 PM ET (1:51 AM GMT), remaining below the $60 mark. were up 0.28% to $64.19. Prices have also risen above the Upper Bollinger band for three consecutive sessions, signaling that a pullback could be in store.

Crude’s rally “just kept pushing and pushing and pushing … then we had the Organization of the Petroleum Exporting Countries (OPEC) surprise and the Saudi attack, triggering the last key surge where now a lot of the recovery and demand expectations due to the vaccines’ success has already been priced in,” Oando Corp. senior market analyst Edward Moya told Bloomberg.

The output cuts from OPEC and allies (OPEC+), in force until the end of April, are widely viewed to hold the market over until fuel demand recovers, despite the widely expected short-term technical dip.

Some investors were skeptical that output cuts could lead to further price gains, however.

Further price gains from output cuts “have pretty much run their course … you can tighten as much as you want, but if you destroy the refining margins and product demand isn’t there, then effectively you don’t really get much further up the chain,” RCMA Group Chairman Doug King told Bloomberg.

Supply-wise, Tuesday’s showed a of 12.792 million barrels for the week ending Mar. 5. Forecasts prepared by Investing.com had predicted an 833,000-barrel draw, while a 7.356-million-barrel build was recorded during the previous week.

Investors now await , due later in the day.

Meanwhile, routine maintenance work on North Sea oil fields is restricting supply to Asia from some Atlantic basin supplies. North Sea supplies will continue to be significantly constrained throughout the second quarter due to maintenance.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.


Most Related Links :
Business News Governmental News Finance News

Need Your Help Today. Your $1 can change life.

[charitable_donation_form campaign_id=57167]

Source link

Back to top button