The oil price looks optimistic. What are the reasons?
Crude reaches two-month maximum on tighter American market
On Monday, crude prices reached two-month maximums, raised by a tightening American crude market as well as the threat of sanctions versus OPEC-member Venezuela.
Brent crude futures soared 0.5% being worth $52.76, the highest outcome since May 25.
American West Texas Intermediate crude futures gained 0.3% hitting $49.86 per barrel.
Crude prices have ascended approximately 10% since the previous meeting of key members by the Organization of the Petroleum Exporting Countries as well as other crucial crude producers, such as Russia, when the group talked about potential measures to further tighten crude markets.
Strong leaps in the price of crude were driven partly by the substantial draw-downs in American inventories for the last several weeks.
Having risen by more than 10% since mid-2016, American crude output went down by 0.2% to 9.41 million barrels a day by July 21.
American crude inventories have descended by nearly 10% from their March maximums to 483.4 million barrels.
The Canadian central bank will make a monetary policy report and announce interest rates on Wednesday, January 20, at 17:00 MT time. Also, the BOC press conference will be held later.
USD’s rally takes a pause, while riskier assets are modestly rising.
We are now past the middle of January, and this means that the largest US companies will report their earnings for the fourth quarter and many of them will provide the results of the entire 2020.