Crude Oil Traders Hoping to Forget September Quickly

Oil traders in the last few days had to withstand the roller coaster moves in this prevailing oil market, as in for the case of Brent crude tested its critical support level around $40/barrel before springing up at the U.S trading session on Wednesday partly due to the U.S dollar losing some of it gains momentarily.

Growing energy supply from the Organization of the Petroleum Exporting Countries (OPEC) weakened oil bulls’ resolve in reaching new highs, as crude oil output surged by 160,000 barrels per day in September from August

Brent crude has recorded a loss of about 6% this month, on mounting worries about the impact on gasoline demand as the COVID-19 onslaught kept its hold on major headlines around the world.

Also adding to the woes of crude oil bulls were the macro coming from Libya as it will be adding more oil outputs to a supposedly saturated energy market.

The bulls would definitely want to forget the month of September in a hurry with recent statistics printing U.S monthly average of fuel demand in the previous week drifted lower, showing the significant effect of rising COVID-19 caseloads that’s seems to be hampering global economic recovery efforts.

It should be said, on humanity side, COVID-19 virus as killed over a million people and still shows no signs of stopping, meaning that it’s unlikely for economic activities to resume at optimal capacity till next year.

As if that, not enough growing political tensions particularly around the world largest consumer of energy, has halted the bullish gains seen in the months of June, July, and August, as odds against the pro-fossil leader increase to election day coupled with high uncertainty on how the U.S election will play out, thereby lowering the probability on crude oil prices closing above $55/ barrel in 2020.

India another important consumer of crude of late revealed the output of crude oil refiners in the month of August dropped by 26.4% from a year ago, the most in more than 16 weeks, as fuel demand paused because of the effect on the ravaging COVID-19 onslaughts on industrial and transportation activity.