Oil Supply Concerns
Supply concerns resurfacing causes oil prices higher
After a sharp rise on Monday, crude oil prices experienced a deep recovery on Tuesday and Wednesday, and West Texas Intermediate (WTI) fell by nearly 6% during this period. However, on Thursday (September 19), International oil prices were moderately higher as the market renewed concerns over the impact of Saudi crude oil facilities on supply performance. US WTI crude oil futures prices hit a high of $59.48 per barrel, while Brent crude futures hit a high of $65.56 per barrel.
Saudi crude oil production fell more than half after the attack, which gave oil prices strong support earlier. However, due to the faster-than-expected recovery of Saudi production, the oil price subsequently retreated some of the gains. However, in the daytime, supply pressures still exist and may continue to bring good returns to oil prices.
At the beginning of this week, Saudi Arabia stated that crude oil production would return to normal levels within two to three weeks, which means that it will return to the level of 10 million barrels per day. Despite this, some traders and analysts have expressed doubts about Saudi Arabia’s expectations being too optimistic. The uncertainty of the resumption process is believed to provide some support for oil prices.
On the other hand, Iran’s Supreme Leader Ayatollah Ali Khamenei said that the attack on Saudi Aramco showed the United States’ defense system in Saudi Arabia failed. It pointed out that under the pressure of US sanctions, Iran will not negotiate with the United States.
This week’s jobless claims data has hit unprecedented numbers. The number jumped to 3.28 million. Initial expectations of 1-1.5 million, which was still a very high estimate, were blown out of the water.
The New Zealand Dollar is fighting it’s way back up as the country enters it’s first official day of nationwide lockdown. It posted a 0.67% gain for the trading day, up to 0.58390 cents against the US Dollar. Just a week ago the NZD had dropped to 0.56, and looked ready to hit the 55 cent mark, as news broke of Air New Zealand’s layoffs.
The Nikkei 225, or Japanese Stock Index had an 8% gain for the day, following on from its 7% gain from the previous day. Less than a week ago the Nikkei had just hit lows not seen since 2017, falling below 20,000 points. However in just 2 days it has made back its losses and is now rapidly on the rebound back to the 20,000 mark.
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