In addition, credible reports reveal the massive container ship stranded at the Suez Canal for some days now have begun to refloat added more selling pressures on the most liquid derivative asset class.
Oil prices at the time of writing this report, are currently down by more than 2% as such macros reveal that oil supply strains will soon ease off as the shipping backlogs at the Suez Canal starts to clear.
Adding to the black liquid hydrocarbon’s near-term headwinds is the soaring U.S dollar which often hurt demand for commodities priced in the greenback. The U.S dollar jumped up on Monday as global financial markets were negatively disrupted after a major investment firm defaulted on margin calls, thereby eroding some appetite for risker assets like crude oil.
Oil bears are back on the center stage amid the all-important OPEC+ meeting scheduled in four days’ time. Energy experts anticipate OPEC+ focus will center on whether they stick to the status quo by extending the current output cuts; as such a change in tone could push Brent crude prices below $60 a barrel momentarily.
Current price actions further reveal Brent crude bears are dominating despite recent upsides as the $63.50 -$65 price area further hint Oil prices head returning to the correctional bearish track; however Brent crude bulls would hold bay at $60 support area as they await a clearer signal of supply disruptions and the outcome of OPEC+ meeting.
The Saudi led coalition had earlier maintained production cuts at higher prices in recent weeks thus look less likely to open the taps, as the third wave of COVID-19 pandemic rattle European markets and certain areas of Australia despite significant progress with COVID-19 vaccines roll out in many parts of the globe,