Knock, knock? Is it already the sky,or just a ceiling? Either way, oil has risen substantially — how high can itgo?
FundamentalUpdates
The crude closed on highs on Thursdaythanks to optimism about demand as well as the remaining tight supply. In fact,this increase is driven by a general market sentiment that is relativelyfavorable to the macroeconomic situation and the conviction that supply shouldremain tight until the end of 2021.
The WTI crude oil futures rose 1.5% -more than $1 compared to Wednesday's close. Like Wall Street, the oil markethas also been sensitive to more and more reassuring tone of messages from Chinaabout the situation of real estate developer Evergrande, which is on the vergeof default. In addition, the acceleration of air travel caused by Washingtonlifting restrictions on entry into the United States could also boost demandfor kerosene. And finally, while natural gas prices are hanging from theceiling, we could see a shift in demand from gas to oil happening, which wouldobviously boost the barrel rally in Q4!
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Thank you.
Sebastien Bischeri
Oil & Gas Trading Strategist
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