During Wednesday’s Asian trading hours, the WTI Crude Oil price succeeded in extending its bullish streak of the week, reaching the highest level in several months, at around the mid-$ 45.00 mark, mainly due to the on-going optimism over a potential vaccine for the extremely dangerous coronavirus, which has fueled hopes of a recovery in the fuel demand, contributing, in turn, to the gains in crude. Apart from this, the increase in the crude oil prices could also be attributed to reports suggesting that the US presidential transition has finally started, which has contributed to the sentiment of political certainty. It is worth recalling that the crude oil prices have increased from about $ 34 to levels above $ 45 this month.

Simultaneously, the crude oil price surged by approximately 4% on Tuesday, to register its biggest single-day gain since November 9. Furthermore, the sentiment surrounding crude oil was further improved by renewed expectations that the Organization of the Petroleum Exporting Countries (OPEC) and its partners will maintain their current production restrictions, which has somewhat eased oversupply fears and helped to keep crude oil prices within the bidding range.

Across the pond, the upbeat market mood is also playing a major role in supporting the higher-yielding crude oil prices. As a result, the upbeat market mood has remained supported by the hopes of an effective coronavirus vaccine and the Brexit talks. Therefore, the broad-based US dollar failed to gain any positive traction and remain depressed, which lent some support to the crude oil prices, as the price of oil is inversely related to the price of the greenback.

On the bearish side, the (API) reported crude oil inventories of 3.8 million barrels for the week ending November 20, surpassing the analysts’ forecast of an inventory build of just 127,000 barrels, which is usually seen as a sign of weak demand. This turned out to be one of the leading factors that kept a lid on any additional gains in the crude oil prices. In the meantime, the improvements in the crude oil prices were further capped by concerns about the escalation of the COVID-19 pandemic, which keep fueling fears of renewed lockdowns in various countries. WTI crude oil is currently trading at 445.30 and consolidating in a range between 44.74 and 45.67.

The US oil stockpiles rose last week, due to increased gasoline inventories, as lockdown restrictions in several parts of the US, in an effort to control the spread of the coronavirus, hampered the recovery in the fuel demand. On the data front, the US crude inventories increased by 3.8 million barrels last week, as per the American Petroleum Institute, after a build of 4.2 million barrels the previous week. Gasoline inventories increased by 1.3 million barrels.

As a result, the broad-based US dollar failed to stop its losing streak of the previous day, remaining bearish as doubts persisted over global economic recovery from the COVID-19 pandemic, as witnessed after the downbeat US Consumer Confidence and Richmond Fed Manufacturing data. Besides this, the risk-on market sentiment, backed by the optimism over a potential vaccine for the highly contagious coronavirus, also played an important role in undermining the safe-haven US dollar. However, the losses in the greenback became the key factor that helped to limit additional losses in the crude oil prices, as the oil price is inversely related to the price of the US dollar. In the meantime, by 11:55 PM ET (3:55 AM GMT), the US Dollar Index, which tracks the greenback against a bucket of other currencies, had fallen by 0.17%, to 92.067.

Across the ocean, the gains in crude were further bolstered by the hopes that the Organization of the Petroleum Exporting Countries (OPEC) and its partners, a group led by Russia and known as OPEC+, will uphold its current production restrictions, which has the effect of easing oversupply worries and undermining the crude oil prices.

On the bearish side, the gains in crude oil were also capped by the intensified fears of rising numbers of COVID-19 cases in the US, Europe and some of the notable Asian nations, which continue to fuel fears of renewed lockdowns in many countries. This has become a key factor that is limiting any additional gains in the crude oil prices.

Looking ahead, the market traders will keep their eyes on the US economic calendar, which will include the releases of the US Preliminary Q3 GDP, Initial Jobless Claims, Durable Goods and Core PCE Index. This data is likely to influence the USD price dynamics and help traders to get some fresh direction. All in all, the updates surrounding the Brexit, the coronavirus and the US stimulus package will not lose any significance. Good luck!