The oil market has started this week with the rise. The prices for benchmarks have hiked maintaining the Q1 upturn being the biggest over the past decade. For now, the driver of the increase is market players' concerns about the global supply. At the same time, another issue that will get market attention will be the upcoming trade talks between Washington and Beijing to take place this week.
Today, July futures for Brent oil soared to some $68.56; the futures for WTI brand moved up to $60.72.
This year, the oil market got support from the measures taken by the USA against Iran and Venezuela. Moreover, it should be mentioned extra support from the production reduction agreement signed by the OPEC members. At the same time, the US President Donald Trump called the Cartel to increase oil supply targeting lower price. Nevertheless, the market did not react to this statement.
For reference, the OPEC agreed to cut oil production by 1.2 million bbl per day in late 2018 striving to support prices and reduce market oversupply.
This week, the market players may be waiting for a new report about the commercial oil reserves and output in the USA.
According to Baker Hughes data released last Friday, the number of active drilling rigs in the USA was the lowest over 12 months.
The Energy Information Agency in its turn surprised the market last week after it had noted an upturn in oil reserves by almost 2.8 million bbl in the USA.
As one of the market experts commented, further oil quotes strengthening can be restrained by the weak state of the global economy and ability of the US producers to ramp up production when the prices start soaring.