Oil Prices Rise On China Data As OPEC Reports Point To Increased Demand – – Daily Cryptocurrency and FX News

Oil Prices Rise On China Data As OPEC Reports Point To Increased Demand – – Daily Cryptocurrency and FX News

Crude oil futures traded higher on April 13, 2021, after a report on Chinese international trade offered more evidence that an economic rebound was taking hold in one of the largest importers of global commodities and crude oil.

A monthly report published by OPEC projecting a spike in economic activity and oil demand, helped by the U.S.’s $1.9 trillion COVID aid package coupled with the rollout of vaccines, also helped enhance sentiment in crude markets.

Nonetheless, worries about a slowdown in the rollout of the COVID vaccine, including calls for an instant stop in the rollout of the Johnson & Johnson one-shot vaccine; have increased some fears about how rapidly the American economy will rebound from the pandemic.

The macro and correlation defense strategist with EAB Investment Group, Arnim Holzer, said in a market commentary:

“The implications of the J&J pause aren’t being seen in crude yet. This may be because the European Covid complications have already muted the price pressures.”

In the April 13 dealings, West Texas Intermediate (WTI) crude for May delivery gained 60 cents, which translates to 1%, to trade at $60.30 per barrel on the New York Mercantile Exchange.

The global benchmark June Brent crude gained 59 cents, or around 0.9%, to trade at $63.87 per barrel on ICE Futures Europe. In their monthly report, the Organization of the Petroleum Exporting Countries (OPEC) mentioned that it expects the bulk of consumption of energy products to pick up in the second half of this year.

That might happen after fresh COVID-19 outbreaks may cause fitful economic recoveries in most parts of the world in the coming months. The report read:

“The year started with new waves of COVID-19 infections, necessitating renewed lockdown measures in many OECD economies. Therefore, the bulk of consumption growth is expected to take place in 2Q21 and 3Q21.”

OPEC was seen to increase its 2021 global oil demand projection by 100,000 barrels per day from its past expectations. It anticipates global oil demand to surge by nearly 6million barrels per day to reach 96.5 million barrels per day in 2021. OPEC also increased its projection for global economic growth to 5.4% from 5.1%. The report continues:

“The upward revision mainly takes into account a stronger economic rebound than assumed last month…supported by stimulus programmes and a further relaxation in COVID-19 measures, amid an accelerated vaccination rollout.”

What Is Moving The Oil Market?

The prices of oil had seen an early bump on Tuesday after data showed that Chinese imports in the terms of US dollars surged 38.1% in March from a year ago, surpassing the 23.3% increase that the analysts had projected.

Geopolitical tensions also were underpinning crude values. Oil futures finished higher on April 12 as reports emerged that Yemen’s Iran-backed Houthi rebels had attacked a Saudi oil facility. That incident lifted tensions in the oil-rich Middle East.

Weekly data on US petroleum supplies provided by the Energy Information Administration (EIA) will be released on April 14, with most commentators and analysts anticipating the government agency to report a drop in crude supplies.

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Analysts also predict a drop of 2.9 million barrels in crude inventories on average for the week that ended April 9, based on a survey done by S&P Global Platts. They also anticipate a drop of 200,000 barrels for gasoline stockpiles and a surge of 700,000 barrels in distillate supplies.

On Nymex Tuesday, May gasoline added around 0.4% to $1.98 per gallon and May heating oil tacked on 0.5% to reach $1.82 per gallon. The May natural gas traded at $2.63 per million British thermal units, which is up 2.7% and is on track to record a fifth consecutive climb.

Oil prices found support from projections for colder-than-usual weather in the eastern and Midwestern US and drops in natural-gas production levels in the past week, based on commodity analyst at Schneider Electric, Christin Redmond.

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