- The WTI attracts some sellers intradic on Monday, although it lacks bearish conviction.
- Uncertainties related to OPEC+ plans to increase perspectives exert pressure.
- The geopolitical risk premium remains at stake and should limit oil prices losses.
West Texas Intermediate (WTI) crude oil prices (WTI) of the US struggle to capitalize on the modest profits recorded in the last two days and attract some vendors near the area of 63.55 $ during the Asian session on Monday. The merchandise is currently negotiated around the region of $ 62.65, with a 0.50% drop in the day, although it lacks bassist conviction and remains confined in a family range.
The US Treasury Secretary, Scott Besent, said Sunday that he didn’t know if the US president Donald Trump had spoken with Chinese President Xi Jinping. This maintains a brake to the recent optimism about the de -escalated commercial tensions between the two largest economies in the world and adds concerns about a global recession, which could affect the demand for fuel. In addition, OPEC+ plans to increase production and weigh even more about crude oil prices.
However, the geopolitical risk premium remains at stake following the prolonged war between Russia and Ukraine. In fact, North Korea confirmed on Monday that he had sent troops to fight for Russia in the war with Ukraine. In addition, the US Secretary of State, Marco Rubio, said that the US could abandon his attempts to intermediate an agreement if Russia and Ukraine do not advance. This is slowing the operators to carry out bearal bets on the prices of crude oil.
Looking at the widest panorama, the black liquid, for now, seems to have stopped its recent moderate recovery from a minimum of several years reached earlier this month and has been oscillating in a range during the last week approximately. This marks a consolidation phase, which, together with the aforementioned mixed fundamental background, justifies a certain caution before positioning for a firm direction in the short term in the absence of relevant macroeconomic data.
WTI FAQS oil
WTI oil is a type of crude oil that is sold in international markets. WTI are the acronym of West Texas Intermediate, one of the three main types that include the Brent and Dubai’s crude. The WTI is also known as “light” and “sweet” by its relatively low gravity and sulfur content, respectively. It is considered high quality oil that is easily refined. It is obtained in the United States and is distributed through the Cushing Center, considered “the crossing of the world.” It is a reference for the oil market and the price of WTI is frequently traded in the media.
Like all assets, supply and demand are the main factors that determine the price of WTI oil. As such, global growth can be a driver of the increase in demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can alter the offer and have an impact on prices. OPEC decisions, a group of large oil -producing countries, is another key price factor. The value of the US dollar influences the price of WTI crude oil, since oil is mainly traded in US dollars, so a weaker dollar can make oil more affordable and vice versa.
Weekly reports on oil inventories published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect the fluctuation of supply and demand. If the data show a decrease in inventories, it can indicate an increase in demand, which would raise the price of oil. An increase in inventories may reflect an increase in supply, which makes prices lower. The API report is published every Tuesday and that of the EIA the next day. Their results are usually similar, with a 1% difference between them 75% of the time. EIA data is considered more reliable, since it is a government agency.
The OPEC (Organization of Petroleum Exporting Countries) is a group of 13 nations oil producing that collectively decide the production quotas of member countries in biannual meetings. Their decisions usually influence WTI oil prices. When OPEC decides to reduce fees, it can restrict the supply and raise oil prices. When OPEC increases production, the opposite effect occurs. The OPEC+ is an expanded group that includes another ten non -members of the OPEC, among which Russia stands out.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
