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US crude oil prices posted a fifth consecutive monthly decline, but settled at their highest level in three weeks on Friday, and improving macroeconomic conditions could maintain the bullish momentum.
This week’s rally was triggered by the lockdown of ~450K bbl/day of Iraqi oil flows due to a dispute with the Kurdistan region, also supported by softer-than-expected US inflation data last month, bolstering hopes that the Federal Reserve will end interest rate hikes.
Concerns about the banking crisis have also eased, reducing fears of a financial crisis that could hit the global economy and oil demand.
Previous month Nymex crude (CL1:COM) for May delivery closed -1.8% in March, capping a 12.5% drop during the five-month streak, but +9.2% on the week at $75.67/bbl for its strongest weekly result since October, and May Brent crude (CO1:COM) closed -4.9% in march but +6.3% this week at $79.77/bbl, its best week since the beginning of February.
Meanwhile, Nymex (NG1:COM) natural gas has been finalized for May delivery. -19.3% for the month – its fifth monthly drop out of seven – and -6.1% for the week at $2,216/MMBtu.
ETFs: (NYSEARCA:USE), (BNO), (UCO), (BOD), (SCO), (USL), (DRIP), (GUSH), (USOI), (NRGU), (UNG), (UGAZF), (BOIL), (COLD), (UNL), (FCG)
The oil market remains tight, which should eventually raise oil prices as demand continues to pick up in China and supply response remains subdued, especially from OPEC+, which will hold its bi-monthly committee meeting on Monday to review the oil market.
A leading think tank in China forecast this week that the country’s crude oil demand could expand by more than 5% this year.
Energy won this week’s S&P sector rankings, with the Energy Select Sector SPDR ETF (NYSEARCA:XLE) +6.3%.
Top 15 gainers in energy and natural resources over the last 5 days: (NYSE:CAT) +41.6%(PPSI) +34.3%(USA) +28%(AZRE) +26.4%(FLNC) +25.4%(EDC) +20.9%(NEXT) +20.3%(TRN) +19.2%(GNE) +18.6%(SUBMITTED) +17.8%(SLI) +16.9%(PLL) +16.8%(EE) +16.4%(NGL) +16%(VTNR) +15.7%.
Top 3 decliners in energy and natural resources over the last 5 days: (DFLI) -27.2%(CETY) -sixteen%(BPT) -13.8%.
Source: Barchart.com
