Crude oil rallies past eight-month peak after surprise decline in US inventory



by   |  VIEW 1380

Crude oil rallies past eight-month peak after surprise decline in US inventory

Despite a series of caustic cloud coalescing over global crude oil demands, both Brent and US West Texas Intermediate crude oil futures’ prices spiked for the fourth straight session in a row on Wednesday as US EIA (Energy Information Administration) data released on the day had unveiled a surprise decline in US crude oil inventory, though a staggering rise in pandemic cases in the United States and Europe appears to have checked the gains.

In point of fact, latest round of rally in crude oil futures’ prices had been almost entirely catalysed by a cascade of media headlines revealing encouraging developments on pandemic vaccines, offsetting worries over a pandemic-restriction associated demand crunch.

Crude oil extends rally as US crude inventories sharply decline

Concomitantly, in the latest flashpoint of a flabbergasting rally in crude oil futures’ prices, Govt. data had revealed that the US crude inventories had been met with a sweeping decline of 754,000 barrels of oil last week, missing an analysts’ estimate which had predicted a rise of 127,000 barrels, while inventories in the US state of Oklahoma fell by nearly 1.7 million barrels.

Citing statistics, on the day’s commodity market round off, UK crude futures’ prices added 1.6 per cent to settle down at $48.61 per barrel, while the US West Texas Intermediate crude oil futures’ prices gained 1.8 per cent to $45.71 a barrel.

Meanwhile, voicing a cautiously optimistic tone over crude oil futures’ prices in a medium- to longer-term outlook, a partner at Again Capital LLC. in New York, John Kilduff said, “There was a decent drawdown at Cushing, so that’s supportive.

It was probably the most bullish aspect of this report,” while addressing to an investors’ optimism related to pandemic vaccine development, a UBS oil analyst, Giovanni Staunovo said, “Crude oil prices are trading at their highest levels since early March, supported by positive market sentiment as a result of vaccine news and strong oil demand in Asia.

We maintain our bullish outlook for next year and target Brent to hit $60 per barrel at the end of 2021.