Oil Price Fundamental Daily Forecast – Rangebound as Traders Lay Low While Awaiting Next Catalyst

U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are trading steady-to-lower on Friday, moving mostly sideways for a third week as investors continued to look for direction from the supply and demand fundamentals.

Since the beginning of the year, prices have been mostly supported by Saudi Arabia’s voluntary promise to cut production by 1 million barrels per day in February, while increasing concerns over the spread of the coronavirus and a slow rollout of the vaccine as well as vaccine supply issues have been capping gains.

At 12:50 GMT, March WTI crude oil futures are trading $52.58, up $0.24 or +0.46% and April Brent crude oil futures are at $55.53, up $0.43 or +0.78%.

The current price action suggests traders are waiting for a catalyst to trigger the next major move in prices. It is most likely to be COVID-related.

Oil Set for Slow Recovery as Vaccines Rolled Out:  Reuters Poll

Oil prices will hover around current levels for much of the year before a recovery gains traction into end-2021 as vaccines help demand gradually emerge from the depths of the coronavirus pandemic, a Reuters poll showed on Friday.

The survey of 50 participants forecast Brent crude would average $54.47 per barrel this year, a jump from last month’s $50.67 forecast. Brent has averaged around $54 so far in January.

The poll forecast U.S. crude to average $51.42 per barrel in 2021 versus December’s $47.45 consensus.

Of the 32 respondents who participated in both the January and December polls, 28 raised their forecasts, painting a slightly more optimistic picture.

An uptick in economic and travel activity fueled by COVID-19 vaccines could accelerate in the second half, analysts said, but the recovery will take time.

The emergence of new virus strains, renewed lockdowns and logistical hurdles facing vaccine roll-outs also prompted the International Energy Agency to lower its 2021 demand outlook.

For a look at all of today’s economic events, check out our economic calendar.