The oil price looks optimistic. What are the reasons?
Crude shrugs off some losses
On Monday, crude prices managed to recover some losses after a 3% dip in the previous session, although markets are still under pressure from high drilling activity in America as well as ample supplies from producer club OPEC.
Brent crude futures reached $47.08 per barrel, rising 0.8% from their previous close.
American West Texas Intermediate crude futures hit $44.60 per barrel, adding 0.8% too.
Brent prices dipped 17% below their 2017 opening notwithstanding a deal led by the Organization of the Petroleum Exporting Countries to reduce output from January.
On Monday, ANZ bank reported that the market kept focusing on the soaring American drilling activity as well as higher output.
The previous week American energy companies added seven crude drilling rigs, thus marking a 24th week of gains out of the last 25 and bringing the overall count up to 763, which is the most impressive outcome since April 2015, as Baker Hughes energy services company revealed on Friday.
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.