Energy Funds Show Resilience as Oil Prices Rise After Record US Inventories Draw
Canadian ETF Market | Aug 08, 2023 10:47
Oil prices surged for the sixth week in a row (WTI crude up 2.78%) after a significant drop in U.S. inventories, pointing to vigorous demand from the world's biggest fuel consumer. Data from the American Petroleum Institute, released on Tuesday, showed that U.S. crude inventories shrank by 15.4 million barrels in the week to July 28, the largest draw seen in data stretching back to 1982.
Furthermore, on Thursday Saudi Arabia extended a voluntary oil production cut of one million barrels per day until the end of September, while Russia has also said it will cut its oil exports by 300,000 barrels per day next month.
Oil markets were initially slow to respond to bullish catalysts such as supply reductions, declining stockpiles and increasing demand. But, as Saudi Energy Minister Abdulaziz bin Salman cautioned speculators of an upcoming short squeeze, the recent rally has gained significant momentum, with WTI crude oil jumping 19.75% over the last six weeks.
Despite this significant rebound, many commodity analysts believe the oil price rally still has sufficient energy to continue, with deficits expected to endure until the first quarter of 2024.
h2 Group Data: Energy/h2This content was originally published by our partners at the Canadian ETF Marketplace .
Get The App
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.