Gold 1784,70
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EURUSD 1,2028
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DJIA 33744,50
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OIL.WTI 61,905
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DAX 15255
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While the stock market situation is quite clear and predictable, the energy market is not so clear-cut. There have been no strong movements in the last month. Oil demand has been stable and of little concern. Ahead is summer and possible weakening due to ongoing vaccinations. Will this affect oil prices or not?
OIL.WTI
Pandemic times will probably be the most difficult for all oil traders. For a long time, they have been using enough indicators and information to make decisions. These are seasonal demand, air traffic, the general state of the economy, electricity consumption, etc. Based on these parameters, it was possible to predict the price of energy in the coming months with a good degree of probability. Now each month is completely unpredictable. All the statistics that used to be used no longer work.
Further adding fuel to the fire is OPEC+. From the structure that is supposed to set the tone, OPEC+ only reacts to current changes. Meetings now take place every month and production quotas are revised every month. At this pace, it is very difficult to readjust quickly and forecast anything, much less plan profits, business development investments and other strategic indicators. Also, such actions directly affect the market volatility of petroleum products.
The next few months will be mixed for energy markets. Forecasts from leading analysts are widely divergent. Goldman Sachs sees the price per barrel of WTI oil at $80 as early as this summer. But the US Energy Information Administration plans average price of one barrel to reach $61.
The US may also contribute to the oil market. In order to meet the demand the USA may increase production of oil, thus making another correction to the overall market.
Another nuance for oil may be rising inflation. Prices are quoted in US dollars. If the dollar starts to weaken a lot, it will in any case support oil, which will definitely be reflected in the quotations.
And another problem for oil – India is reporting 384,000 COVID-19 infections a day. This is the highest number ever recorded in that country. India could well go into quarantine, which is bound to affect the price.
There are challenging times ahead.
01.30 Japan National Consumer Price Index YTD
08.00 Retail sales in England YTD
15.45 US Composite Business Activity Index for April
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