The oil market received positive news on Thursday as oil futures for Brent and WTI Crude rallied for the first time since the oil price crash in early March, all fueled by the positive news of vaccine approval in Canada and the United Kingdom. Brent Crude hit $50 per barrel, while WTI Crude was trading as high as $47.23 Thursday. Analysts are optimistic that this may be a strong indication that the economy will receive a boost heading into next year.
Earlier this week, the Energy Information Administration (EIA) reported a massive crude inventory build of 15.189 million barrels for the week, which came close to the largest crude build from earlier this year. The EIA reported an inventory build of 19.25 million barrels for the week ending on April 10. According to Phil Flynn, senior market analyst at The Price Futures Group, “Oil prices stool tall even after a massive 15.2-million-barrel crude oil increase in U.S. oil supply. The crude oil market is looking beyond the numbers. The market held key support and is now focusing on vaccine distribution that could lead to a spike in demand that should drive global supply back below normal levels next year.” Flynn also stated that Chinese demand is beginning to exceed pre-COVID levels and there are reports of an “uptick” in Chinese refineries.
At the time this blog was written, Brent Crude was trading at $50.12 and WTI Crude was trading at $46.74.