Oil Extends Rally Amid Light Trading
by Bloomberg | Julia Fanzeres and Grant Smith
click here to read this article at Rigzone.com
*this article was not written by Roseland Oil & Gas
Oil held its recent gains in light trading, helped by tighter supplies and optimism that China’s government will boost the country’s economy.
West Texas Intermediate settled above $79 as open interest hovered around January lows while risk-on sentiment in equity markets bolstered gains. China, the world’s largest crude importer, indicated more support for the real estate sector alongside pledges to boost consumption on Monday. Despite the light trading volumes, technical patterns and fundamentals are showing increased signs of market tightness.
US benchmark West Texas Intermediate and Brent closed higher than their 200-day moving averages on Monday for the first time in nearly a year, and both settled above that level again Tuesday. Staying above that barrier for a prolonged period may help spur additional buying as it suggests a healthier technical backdrop. Meanwhile, WTI’s prompt spread is at 43 cents a barrel in backwardation — the highest since November, signaling that physical markets are still parched for crude.
Oil has pushed higher this month after the Organization of Petroleum Exporting Countries and allies pared supplies to help drain global inventories. That move has offset the drag from Federal Reserve Chair Jerome Powell’s campaign of monetary tightening, which is expected to continue with another rate hike this week.
Gasoline is also in focus after Exxon Mobil Corp. shut a unit at one of the largest US refineries, sending US futures to their highest level since October.
Prices:
- WTI for September delivery rose 89 cents to settle at $79.63 in New York.
- Brent for September settlement climbed 90 cents to settle at $83.64 a barrel.
by Bloomberg | Julia Fanzeres and Grant Smith
click here to read this article at Rigzone.com
*this article was not written by Roseland Oil & Gas