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Crude oil traders appear to focus more on the supply and demand rebalancing than prevailing narratives, such as COVID-19 resurgence, global economic growth, and Crude oil stockpiles.
Still, Brent crude remains above a strong resistance level around $45 at London’s trading session on Monday, buoyed on hopes that a sustained recovery in energy demand is picking up coupled with recent macro coming from the world’s largest economy showing gasoline, crude oil, and distillate inventories all dropped the week-ending August 7.
The world’s second-largest economy is also feeding crude oil bulls, with impressive macros.
China’s economy is showing signs of economic recovery with stimulus support on infrastructure activities set to boost demand for heavy equipment and fuel to power them, energy experts say.
However crude oil traders remain wary on the surge in COID-19 caseloads globally, strengthening fears that a second wave could cause more damage on the world’s fragile economy coupled with new restrictive policies around major economic hubs that could slow global demand for energy, similar to what happened in February and March.
The world’s largest economy latest reading on COVID-19 caseloads showed the death toll has now surpassed 170,000, according to Johns Hopkins University data.
Russia’s Energy Minister Alexander Novak recently disclosed that the global energy market is stabilizing slowly, so no need to ease OPEC+ output cuts ahead of schedule.
Crude oil traders will place their bets, in the mid-term on the outcome of the Organization of the Petroleum Exporting Countries and its allies (OPEC+) meeting that was rescheduled to August 19.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire