- Brent crude oil breaks above $70/bbl for the first time since 2014 before settling at $69.26/bbl, extending the market’s strong start to the year, underpinned by the effectiveness of OPEC output cuts and geopolitical risk in producing countries such as Iran.
- In the U.S., WTI crude climbed to $63.80/bbl after trading as high as $64.77, as domestic stockpiles posted their eighth straight week of declines, the longest stretch during winter in a decade.
- Noting that U.S. crude inventories are at their lowest level since August 2015, PVM Oil Associates analyst Tamas Varga says “OPEC is edging ever closer to its desired target of reducing OECD industrial stocks to the five-year average.”
- Gary Ross, head of oil at S&P Global Platts Analytics, who forecast $70 Brent oil last year, sees potential for the market to keep rising as he thinks many are still overestimating the size of remaining inventories.
- Eugen Weinberg, head of commodities research at Commerzbank (DE:CBKG). thinks the oil market is overheating: “$70 is too much. It is not completely unexpected, given the price momentum. But there will be a reaction in U.S. shale, and OPEC’s strategy will backfire massively.”
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- Now read: Weekly Oil Storage Report - Let's Start The Bullish Q1 We've Been Waiting For
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