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Market Digest Nigeria

Economy

Crude oil price remains relatively stable amid mixed economic data

Crude Oil prices remained relatively stable at London’s trading session on Thursday.

Crude oil traders are becoming wary due to growing concerns amid rising Coronavirus infections. This is in addition to a recent plunge recorded lately in America’s oil Stockpiles.

West Texas Intermediate (WTI) crude futures eased 0.36% to $42.04 a barrel as at 0905 GMT. Brent crude futures, on the other hand, rose slightly by 0.13% to trade at $45.23.

The two benchmark contracts gained more than 1% yesterday to reach their highest price marks since March 6th, thereby completing a four-day rally after the US Energy Information Administration (EIA) reported a much bigger than expected drop in U.S. crude stockpiles.

Stephen Innes, the Chief Global Market Strategist at AxiCorp in a note to Nairametrics, gave valuable insights on the macros crude oil traders are currently betting on. He said:

“The direction for oil in 2H will depend mainly on the willingness of traders to look through the short-term supply and demand uncertainty as gasoline demand has ground to a halt for now, and the summer season driving clock is ticking.

“But in this environment, traders may be content to focus on the ongoing market rebalancing. The recent surge in virus cases and the re-imposition of some virus control measures will moderately slow the economic recovery in the near term but expect the recovery to get back on track in September, assuming virus developments don’t prompt the re-imposition of widespread lockdown.”Crude oil traders will ultimately, continue to train their eyes on the ultimate vaccine prize, for a lasting solution to the ravaging COVID-19 pandemic.

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