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Crude Oil Prices Continue Positive Moves

By Abhishek BansalCommoditiesApr 19, 2021 05:28AM ET
Crude Oil Prices Continue Positive Moves
By Abhishek Bansal   |  Apr 19, 2021 05:28AM ET
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Positive economic data from the US and China are likely to support energy demand and that is bullish for crude oil prices.

WTI crude oil prices were trading above $63.21, sharply higher from the recent low of $57.25 registered on Mar. 23. However, demand concern, due to the rapidly expanding deadly coronavirus pandemic, is likely to limit the gains. The global pandemic is leading to extended lockdowns that are likely to curb economic activity and fuel demand.

Crude oil prices found additional support on strong Chinese data and better-than-expected US housing data.

US March housing starts rose +19.4% m/m to a 14-3/4 year high of 1.739 million, against expectations of 1.613 million. Also, March building permits rose +2.7% m/m to 1.766 million, stronger than expectations of 1.750 million.

China's Q1 GDP expanded by a record +18.3% y/y (data from 1978), also, China’s March crude processing rose +20% y/y to 14.14 million BPD. China's March industrial production rose +14.1%y/y, the largest increase in 9-3/4 years. In addition, March retail sales rose a record +34.2% y/y (data from 1995), stronger than expectations of +28.0% y/y. 

Also, the IEA on Wednesday boosted its 2021 global oil demand forecast by +230,000 BPD to 5.7 million BPD. However, coronavirus is rapidly expanding globally despite the vaccination drive and is likely to limit gains in crude oil. The overall global COVID-19 caseload has topped 141.1 million, while deaths have surged to more than 3.01 million, according to Johns Hopkins University.

US crude oil inventories as of Apr. 9 were +1.6% above the seasonal 5-year average. Gasoline inventories were -2.4% below the 5-year average, and distillate inventories were +3.4% above the 5-year average. 

Baker Hughes reported on Friday that active US oil rigs rose by +7 in the week ended Apr. 16 to an 11-1/2 month high of 344 rigs.

According to the CFTC Commitments of Traders report for the week ended Apr. 13, net long for crude oil futures plunged by 19,047 contracts to 492,678 for the week. Speculative long positions dropped by 5,430 contracts, while shorts rose by 13,617 contracts. 

Crude oil prices are likely to trade firm while above the key support level of 20 days EMA at $61.46 and 50 days EMA of $59.92. Meanwhile, it may face stiff resistance around $64.78 and $67.10.

Crude Oil Prices Continue Positive Moves

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Crude Oil Prices Continue Positive Moves

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Disclaimer: Mr. Abhishek Bansal is a new-age, first-generation entrepreneur, and the Founder Chairman of Abans Group, a quintessential diversified business group, providing expertise in Broking Services, Non-Banking Financial Dealings, Financial Services, Agri-Commodity Services, Warehousing, Realty & Infrastructure, Gold Dore Refinery & Manufacturing, and Trading in Metal Products, Pharmaceuticals, Software Development & Wealth Management.
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