Oil prices surged to multi-week highs today amid OPEC hinted at optimism over its deal to curb oil production. WTI crude April futures were trading at $54.50 per barrel (1:30AM) and yesterday the previous month contract expired at the highest level since Jan, 3, hitting a 19-month high in intraday trade. OPEC secretary general said that January data showed that the conformity from member countries participating in the output cut had been above 90% and oil inventories would further slide this year.However, market participants are closely watching the release of inventory numbers from the US, to be released by the AMI to be followed tomorrow by government data. Bloomberg survey of eight analysts expects crude stock to rise by 3.325 million barrel at the end of this week. A stronger dollar is also putting some pressure on prices but apparently not enough to keep the current momentum of prices in check.In the days ahead, oil prices are likely to break out of their recent range and head … [Read more...] about Is Oil headed higher?
Opec cuts oil production
The pair started rallying late last year after US central bank decided to hike rates. Given the strong view on further rate hikes and the strong dollar, it was expected to rally further. However the loonie found some support due to protectionist-touting Trump and an OPEC agreement to cut oil production. … [Read more...] about Loonie edges up amid uncertainty in Trump‘s policy
Gold prices started gaining post the March FED meeting when Yellen was less hawkish than expected, pitching for a gradual pace of rate hikes, versus investors expectations of rapid rate hikes. Fears about the European election, which later proved unfounded, also supported prices. Now the key metric that investors are watching are Oil prices, with a weekend meeting of OPEC to decide on the extension of the production cut going forward. Any move to repeal the production cut would quickly bring down Oil prices, bringing down the inflation outlook across the globe. This move will support Gold prices and see it move higher to test previous highs in the near term. However the more likely outcome, which would be the extension of the production cut, would see Oil prices move higher and stoke the risk on sentiment. Equities moving higher along with the Oil will likely lead to Gold prices into another correction from the current levels. … [Read more...] about Gold hovering close to a three week high