Crude Oil Futures up for June: oil markets prove resilience is alive and kicking

 

crude oil futures for June

Despite the rise in Covid-19 infections across the world, the accelerated pace of vaccinations managed to keep the optimism alive by keeping the old, dark days in 2020 behind us.

In a positive, encouraging development, the crude oil futures for June have risen, causing a hole in the bubble of doom: WTI crude and Brent crude rose by $0.32 and $0.34 respectively, while generating a pulse of surprise in the crude oil markets.

Of course, the latest economic data from the US is highly encouraging. The economic package unveiled by the new US administration is behind an unprecedented public spending boom that led to the latest forecast by the IMF full of optimism.

In China, the world’s second largest economy, too, the latest data shows a steep growth.

The US oil stockpiles, meanwhile, which fell during the week ending 26 March, are going to go down again, according to the latest forecast by the API, the American Petroleum Institute.

US crude oil stocks


On yet another positive note, the talks between Iran and the West are continuing with cautious optimism; although Iran seems to maintain a ‘tough’ stand during the negotiations, the ground realities are different: it really wants to revive its oil trade and sanctions lifted in order to enter the international financial markets again.

Investors are not paying undue attention to the spat between Saudi Arabia and India, the world’s third largest consumer, that has been simmering for weeks over the crude production cuts; it’s surprising that the surge in Covid-19 infections in India, which could easily hamper the demand of crude oil, did not deter investors either.

Having seen the pattern of the first two waves of the pandemic, investors know they have relatively-short life cycles; we generally come out of them and risk are still manageable, if individuals perform their civil duties without making a fuss.

The rise in crude oil futures for June came about at a time when quite a few geo-political developments revolve around the market sentiments. In this context, it’s significant as markets know the future is bright amidst uncertainties.  

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