Oil Up, but Eases from Five-Day Rally Over Profit Taking By Investing.com
By Gina Lee
Investing.com – Oil was up Tuesday morning in Asia but eased after a five-day rally. Fears that rising prices would lead to lower fuel demand have increased. However, the market sentiment remains firm in spite of tight supplies globally.
were up 0.28% to $78.94 by 10:27 PM ET (2:27 AM GMT) and were up 0.36% to $75.72. Brent and WTI futures were both above the $75 mark.
Toshitaka Takayama, Fujitomi Securities Co Ltd analyst, said that oil markets had taken a break after a prolonged rally. This was despite concerns about rising fuel prices.
“Still the market sentiment continued strong with tighter supply,” Toshitaka Tazawa said, adding that Brent futures may reach $80 per barrel in the near future. Goldman Sachs Group Inc. (NYSE:) also raised its year-end forecast for Brent futures by $10 to $90 per barrel, which also boosted investor sentiment.
Many members of the Organization of the Petroleum Exporting Countries (NYSE:) are having difficulty meeting their higher quotas. Top African oil exporters, Nigeria and Angola, have warned that they won’t meet them until at least 2022.
As global fuel demand recovers from recent COVID-19 epidemics, and after Hurricane Ida inflicted damage to the U.S. Gulf of Mexico in August 2021, global supplies are still tight.
Investors await the release of this information later in today.
Some investors also suggested that rising spot liquefied (LNG) and coal prices could also give the black liquid a boost.
Vivek Dahar, Commonwealth Bank commodities analyst, said that the oil market could rise by 0.5% or 0.5million barrels more per day as higher gas prices make it harder to switch from oil consumption to gas.
According to the note, “This is going to tighten oil markets even more, especially with supply enhancements from OPEC+ remaining quite prudent.” However, prices could rise from now if it turns out that the northern hemisphere winter was colder than predicted.
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