High Odds for COVID -19 Vaccines Support Crude OilCrude oil prices ended the previous week on mixed amid high concerns that COVID-19 cases are now getting out of hand on reports showing the number of people infected with COVID-19 virus globally surged past 38 million.
Major crude oil benchmarks that include Brent crude ended W/W slightly lower, losing 0.2% as oil traders worry the London based oil contract, might have its demand tightening on the macro stating COVID -19 caseloads is exploding at an alarming rate in major European countries like Germany and the United Kingdom.
However the popularly known U.S oil grade West Texas Intermediate ended W/W quite impressive has it gained 0.7%, as recent U.S oil stockpiles printed an uptick in oil demand, coupled with the bias, the Republicans would pass some form of stimulus deal in smoothening the World’s largest fragile economy on sentiments showing the U.S election is fast approaching.
On the parabolic, the black liquid hydrocarbon faces intense pressure near term, on the bias revealing oil bulls in recent weeks seem to suffer momentarily from exhaustion, anytime they approach their immediate key resistance price levels coupled with another major bias that reveals low chances of gasoline demand/supply levels taking shape to pre-COVID-19 era, on sentiments that major oil producers might not be able to sustain their commitments in keeping with current oil production cut due to their weak earnings and high budget deficits, as most depend on the black fossil for their economic development.
In spite of the prevailing macro surrounding energy demand, many experts don’t see crude prices to breaching below the $35 /barrel support level, as the world’s leading Pharmaceutical Company Pfizer announced that its COVID-19 vaccine product would be ready before the year runs out.
A duly registered COVID-19 vaccine readily available at such time could propel crude oil prices near $45/Barrel and most importantly restore the type of volatility seen in the pre-COVID-19 era.
That said, Brent crude prices are still showing an impressive amount of resolve around the $40/barrel price levels amid profit-taking seen at around $43-$43.20 price levels on cyclic fundamentals showing oil traders exposed by the high geopolitical uncertainty.
It’s critical not to forget oil traders are kind of focused more, in the near term on the likely winner of the U.S election, on the sentiments that President Trump re-election will be a nice macro for the black fossil market amid his dwindling odds for re-elections.