The strong trend in oil is sustained, supported by another drop in US oil reserves. The increasing US consumption is mainly due to the colder winter that hit the country. Stocks declined by 4.95m. barrels for the second consecutive week, while US production declined with the most since October.
The positive effect of the OPEC deal also supports the markets, but this will not last long, as the US Energy Ministry has announced that the US will increase its production to 10m barrels per day as early as next month. Taking this into account, we expect WTI to keep below $65 a barrel, and if US production continues to increase, the likelihood of the trend is changing dramatically. At the same time, the big Wall Street players are of the opinion that a price above $70 per barrel is a mirage.
Source: Bloomberg Pro Terminal
Jr Trader Petar Milanov