Oil gains For 4th Consecutive Month Amid COVID-19
After outsized U.S. draws in everything, from crude oil to gasoline and diesel, bulls helped the market bounce back at the last trading session in July.
Oil prices have been rising for a fourth consecutive month as both New York-traded WTI crude and British Brent crude traded at modest gains in July.
On Friday, West Texas Intermediate settled at $73.95 per barrel, up 0.5%. In the week ending Friday, U.S. oil rose 2.1%, marking its highest week in five. July’s figures showed an increase of 0.7% as well.
Oil price benchmark Brent crude settled at $75.41, an increase of 0.4% on the day. Brent gained 1.8% in the past week. The price of Brent rose 1.1% for July. Those were its best six-week results.
Brent crude bulls face a strong resistance level at $75 a barrel thus waiting for positive momentum that will help push the price to surpass this level and confirm extending the bullish wave up to $77.5 as the next positive target.
An influx of Delta variant cases of COVID-19 held back oil prices prior to the week ending July.
With commercial inventories falling to their lowest point since January 2020 and indications that this tightening will continue, crude prices received major support this week from U.S. inventory dynamics.
Similarly, the markets have seemingly adjusted to the fact that President-elect Raisi will be sworn into office next week, which mitigates concerns that Tehran might flood the market with incremental barrels. Several European countries are experiencing rising Delta variant cases despite the COVID headwinds.
Despite growing investor risk appetite in oil in recent days, bulls did not dominate the market as much as they could have earlier in the year when crude prices rose almost without break week after week.