WTI Crude Oil Extends Bullish Moves – OPEC+ to Continue With Supply Cuts?
Arslan Butt • 1 min read
WTI crude oil continues its bullishness from the previous session into early trading on Thursday as markets anticipate OPEC+ countries to hold supply constant instead of increasing it, amid an uncertain outlook for oil demand in the near term. At the time of writing, WTI crude oil is trading at around $61.74 per barrel.
Speaking to Reuters, multiple OPEC+ sources hinted that the leading oil producing nations could announce an extension of the current levels of supply cuts into next month during their meeting later today. The ongoing coronavirus crisis, especially the discovery of new strains, could pose pressure on recovery of the global economy and oil demand, despite the COVID-19 vaccine rollouts.
Over the past few sessions until Wednesday, crude oil prices had been weakening over concerns that OPEC and its allies could increase crude output as the global economic outlook improves on the back of the vaccine rollout. There were also concerns that Saudi Arabia could roll back the additional 1 million bpd cut in supply underway in February and March as the likelihood of lockdowns and restrictions would reduce with increased distribution of vaccines.
On Wednesday, WTI crude oil also turned bullish on the release of the EIA report which revealed a decline in US gasoline and distillate inventories even as crude stockpiles rose due to the refiners being shut on account of the deep freeze. Gasoline inventories were down by 13.6 million barrels during the past week while distillate fuel inventories declined by 9.7 million barrels even as crude oil inventories rose by 21.6 million barrels.