Oil in scattered order at the end of a quiet week

Brent ended up 0.6% to $ 55.88 and WTI ended up 0.3% to $ 52.00.

Oil prices ended in loose order on Friday after a relatively quiet week in crude markets, with gains limited by the still murky outlook for demand for black gold.

A barrel of North Sea Brent for March delivery, which is the last day of trading, gained 35 cents, or 0.6%, to close at $ 55.88.

WTI’s US barrel for the same month fell 14 cents, or 0.3% to close at $ 52.00.

“Demand concerns continue to cap gains” in crude oil, analysts at JBC Energy said.

“In the United States (the world’s largest consumer of crude) but also across the planet, weekly gasoline demand continues to evolve well below usual levels,” they added.

The latest report from US officials, released on Wednesday, showed US gasoline reserves rose 2.5 million barrels, almost twice as much as analysts expected.

Slowly but solidly recovering since the first announcements of vaccines against Covid-19 in early November, Brent and WTI on January 13 hit all-time highs in more than eight and a half months, at $ 57.42 and $ 53 respectively, 93 dollars a barrel.

They have fallen back slightly since, limited by the containment measures still in place across the world and the caution of investors in the face of certain vaccination campaigns that are slipping.

The latter are also awaiting the next meeting of the Organization of Petroleum Exporting Countries (OPEC), which will take the form of a Monitoring Committee for the current agreement to reduce the group’s production, identified by the acronym. JMMC, and will be held on February 3.

The cartel and its allies have implemented a drastic reduction in their production volume of black gold since the spring in the face of the drop in demand and prices caused by the Covid-19 pandemic, in the order of 7, 2 million barrels per day (mbd) in January, 7.125 mbd in February then 7.05 mbd in March.

“The fall in demand due to the restrictive measures is offset by a sufficient reduction in supply,” sums up Carsten Fritsch of Commerzbank. “This prevents prices from going up or down very significantly.”

One of the unanswered questions, according to him, is what impact on US crude production in the United States will have the moratorium on oil drilling on federal lands and waters decided by US President Joe Biden.

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