Crude oil cruises higher on recovery hope, OPEC+ pledge to squeeze supply

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Crude oil cruises higher on recovery hope, OPEC+ pledge to squeeze supply

On Thursday, both US and UK crude oil futures had extended their recent leg of blowout rally as strong US economic data, a steep spiral downwards in US crude stockpiles alongside OPEC+ members decision to hold on to their output curbs, had amped up investors’ optimism, however, a sharp rebound in American Dollar seemingly had kept a lid on the gains.

In point of fact, throughout this week, both Brent and US WTI (West Texas Intermediate) crude contracts had coffered solid gains over possibilities of another trillion-dollar stimulus bill from the US Government, while Thursday’s sparks in crude oil futures’ prices were mostly supported by a slew of strong economic data in the United States as new orders for US-made core capital goods rose 1.1 per cent in December and US weekly jobless claims lowered last week.

On top of that, a decline in US crude inventories to their lowest level since March 2020, had maintained a bullish wind in the day’s commodity market, while market participants’ hope of a faster economic recovery alongside a demand-surge for oil ramped up further following reveal of a media topline that underscored the Democratic Senators in US Congress had taken their first leap forward towards passing a trillion-dollar pandemic stimulus bill as proposed by the US President Joe Biden earlier last month.

Oil futures on cloud nine over strong US economic data, OPEC+ output cut

Citing statistics, as both US WTI and UK crude oil futures’ prices had spanned their blistering rallies into fifth straight session in a row, UK crude ended up the day 0.4 per cent higher to $58.84 a barrel after hitting a session high of $59.04, its highest level in nearly twelve months, while US WTI crude oil futures’ prices climbed 0.7 per cent to $54 per barrel.

Meanwhile, referring to a recent move from 14-member OPEC (Organization of Petroleum Exporting Countries) alongside its Kremlin-led allies to limit crude oil output, a partner at Again Capital in New York, John Kilduff said, “…Given the broader situation with OPEC+, I would expect for this market to tighten up further.