Crude oil prices were relatively higher at the last trading session of this week after losing more than 1% in value in the previous two trading sessions.
Oil bulls are nursing their wounds still, after the bears had increased their selling pressure at unprecedented levels, on the basis that COVID-19 recent attacks on key emerged markets has brought about a freeze on the energy demand/supply rebalancing wheel, taking oil prices far below $40/ Barrel.
In the case of Brent crude futures it trades below its critical support level of $38.50/barrel at the time of writing this report.
However, Oil bulls are presently riding on macros, showing the world’s largest economy and consumer of energy printed a far impressive economic data than anticipated by many Wall Street analysts.
Data seen from the U.S Commerce Department’s released yesterday revealed the world’s leading producer of oil, recorded a GDP growth of 7.4% from the prior period, a quarterly surge that equals an annualized growth of 33.1%.
That said, the recent price action shows the bulls present resolve is slowing down on the bias that, North Africa’s leading producer is bringing oil supplies to an supposedly fragile energy market coupled with bearish sentiments on the second wave of Covid-19 prevailing in the Northern hemisphere, saw oil bulls suffering from exhaustion as it tried to break above $38.50/Barrel.
Adding pressure on oil prices in the mid-term are macros showing leading oil and gas companies have reduced their operating costs by 35%, on the sentiments that COVID-19 resurgence will soften energy demand in the global economy growth by at least 3 months.
That said the oil cartel group is expected to intervene strongly with all ammunitions at its disposal as it monitors the deteriorating demand prevailing around the global economy closely as well as rising crude oil supplies from Libya.
Oil traders, remain upbeat that it’s almost impossible for oil prices to go negative as seen in April, but remain highly worried on the COVID-19 attacks still making major headlines. Nevertheless traders are now focusing their attention on the likely winner of the tightly contested U.S election coming up in few days’ time.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire