Photographer: Luke Sharett / Bloomberg
Photographer: Luke Sharett / Bloomberg
Brent oil gave up some gains at the end of the worst week since October, as the dollar strengthened and as investors assessed short-term demand prospects.
Futures in London lost 1% to fall below $ 64 a barrel as the dollar’s rise reduced the attractiveness of commodities to the U.S. currency. Demand shows some signs of weakness with the number of unsold oil loads from West Africa swell, while Germany proposes an extension blocking restrictions. Despite recording a 2% rise on Friday, crude oil suffered a sharp weekly loss after a bearish start last week.
See also: Oil continues on a bumpy path to recovery despite price deviation
Meanwhile, Saudi Arabia saw another assault on its energy facilities. While the offensive of the Houthi rebels backed by Iran in one On Friday, the Aramco refinery had no impact on oil supply, it is the last in a series of attacks on the kingdom.
Despite the weekly drop, there is confidence in the long-term outlook and a return to higher prices. Goldman Sachs Group Inc. said the recent sale was temporary and that the rebalancing would continue with vaccines that would drive greater mobility. The market will be watching the OPEC + meeting next week for any changes in its production policy in May, especially after the fall in oil and comments from the International Energy Agency that the supply is plentiful.
“Oil could continue to oscillate between red and green, divided between fears of demand and optimists,” said Vandana Hari, founder of Vanda Insights in Singapore. “Prices are likely to hover around current levels, at least until the next step of OPEC +,” he added.
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The rapid time period for Brent is still in a bullish retreat, where nearly dated prices are more expensive than those of a later date, although the difference narrowed over the past week. The spread stood at 16 cents a barrel on Monday, compared to 67 cents at the start of the month.
Meanwhile, Iran’s supreme leader, Ayatollah Ali Khamenei, said his country was in no hurry to revive the nuclear deal, although he reiterated that Tehran was still ready to return to the original terms of the deal once the US lifted sanctions. Despite the sanctions, Iranians Crude oil exports appear to be rising, and China has recently increased its purchases.
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– With the assistance of Rob Verdonck