Brent oil is paring some of its gains this week, having rebounded off the psychologically-important $70 mark.
Still, the global oil benchmark appears poised to head into the weekend having registered its first weekly advance in three weeks.
Brent oil has been tracking the moves in broader markets as contagion fears along with recession risks continue to dampen demand for riskier assets.
Such woes forced a break to the downside of the range that Brent had largely adhered to year-to-date, prior to the SVB and Credit Suisse crises.
China’s stuttering economic recovery isn’t helping oil’s fortunes either.
Oil prices have all to do to erase recent losses.
Even if the stresses of the financial sector are firmly relegated into the past, that would only pave the way for even more demand-destroying rate hikes by major central banks that are still keenly intent on upholding their inflation-fighting credentials.
Ultimately, risk-on mode has to return with a vengeance, predicated on a rosier outlook for global demand for oil, in order to provide a fundamental spark for Brent to be restored back above its 100-day simple moving average (SMA).
Markets are widely expecting that OPEC+ would stand pat on its production levels at its weekend meeting.
2 June 13:21
Although on course for back-to-back weekly gains, oil’s advance for this week was significantly pared after Russia hinted that another OPEC+ supply cut may not be forthcoming at its early June meeting.
26 May 13:57
The global oil benchmark is on course to post a weekly advance of over 3%, ending a run of four straight weekly declines.
19 May 13:27
As mentioned in last Friday’s article, “Brent’s recent rebound is unlikely to be sustained …”. Sure enough, the global oil benchmark is unwinding some of its technical rebound, as demand-side fears continue to fester across markets.
12 May 12:21
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