Crude Prices: A Bit of a Bumpy Ride
Crude pulled its fans into a shaky week, but the front‑month WTI contract is just about keeping up the streak with a second straight weekly gain. That’s the first time we’ve seen it since early July, and the trading week is winding down.
Why the bulls are backing out of the break-up
- U.S. recession nerves easing – Better‑than‑expected retail sales and lower-than‑predicted jobless claims comfort the market, calming fears that the U.S. economy is on a rapid slide.
- Industry production still a drag – July industrial output fell a sharper 0.6% month‑over‑month, which keeps one of the underlying supports a bit shaky.
- Geopolitical jitters holding the floor – Every trader knows there’s always a shadow on the horizon. The market is holding its breath after the assassination of a Hamas leader in Tehran two weeks ago. No retaliation has happened yet, but that threat alone makes folks reluctant to stake heavily on short positions, especially with the weekend break looming.
- Demand is the real kicker – The price lift still needs a big, joint surge in global appetite for oil. Until demand spikes across the board, the rally for Brent and WTI will stay modest.
OPEC’s latest twist
OPEC shed its 2024 demand forecast early this week, mainly because China’s buying power is looking pretty lackluster. That said, the cartel is planning to roll back its current output cuts in Q4. Those cuts might be postponed to next year, depending on how the market swings.
The big take‑away
Crude’s “up‑and‑down” dance continues. While the U.S. already nudged back from a recession scare and geopolitical tensions floor the prices, sustained rally will come only when global demand co‑ordinates on the right note.
