The oil market regained some risk appetite as priced moved back towards previously reached highs on Thursday, July 22. Brent rebounded 1.9% to $73.02/bbl, while WTI surged 2% to $71.54/bbl.
As reported by Bloomberg, the recent unexpectedly sharp decline in oil prices may have been caused by China’s sale of oil from its strategic reserve in order to reduce domestic prices for petroleum products. However, it looks as though the negativity triggered by fears of insufficient demand might not yet be fully priced into crude futures, although expectations of an oil shortage in the medium term may continue to propel prices higher.
This morning oil prices again reverted to a downward correction, with Brent off 0.15% and trading for less than $73/bbl on the ICE, while WTI is 0.13% lower. Our Brent price forecast for today is in the range of $72-73.3/bbl.