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  • Oil prices slope below $61 on a rising dollar and an upcoming OPEC meeting

Oil prices slope below $61 on a rising dollar and an upcoming OPEC meeting
Oil & Gas | 30 March 2021

Oil fell below $61 a barrel in New York, hampered by a stronger dollar, as traders weighed dangers to the demand recovery ahead of OPEC’s ministerial meeting this week as reported by Bloomberg.

West Texas Intermediate slid 1.7%, while the greenback was stronger, making commodities evaluated in the currency less attractive. Treasury yields likewise climbed. While fuel consumption is ascending in numerous pieces of the world, risks remain, with the top of the U.S. Centers for Disease Control and Prevention cautioning of “impending doom “as cases and deaths in the nation pick up.

Oil is ready to finish off a fourth quarterly advance on Wednesday, yet the previous week has seen instability move in the midst of the Suez Canal blockage. All eyes are currently on the Organization of Petroleum Exporting Countries and its allies, whose ministers assemble Thursday to decide output policy for May and possibly beyond, and are required to maintain tight curbs to deplete global inventories further.

Hans Van Cleef, the senior energy economist at ABN Amro said, "After some wild moves, we see some stabilization". With U.S. shale not getting quick, and prices generally stable around $60 WTI for the present moment, he added, “I would not be surprised if OPEC again indeed decide to roll over for another month."

At their virtual meeting, OPEC and its accomplices will consider whether to restore part of the 8 million barrels of daily output, about 8% of the global supply that they're retaining. At their last gathering recently, the group had been broadly expected to return a few barrels to the market but, led by Saudi Arabia, opted not to do so given the sustained threat presented by the pandemic.

Prices:

  • West Texas Intermediate (WTI) for May delivery fell $1.04 to $60.52 a barrel at 7:21 a.m. New York time
  • Brent for May was down by 1.5% at $64.03

In the U.S., the fight against the Covid actually presents a mixed picture. While the speed of jabs is picking up and is set to hit 3 million every day, cases are rising. Virus-related hospitalizations are presently climbing in 25 states.

Elsewhere, traders are tracking progress towards the arrival of normal services through the Suez Canal after a ship that had impeded the waterway was liberated on Monday. Salvagers utilized a blend of a full moon, high tide, and a flotilla of tug boats to move the Ever Given, permitting traffic to continue.

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