By Srinivas Chowdary Sunkara // petrobazaar // 10th January, 2019.
Brent jumped $2.72 or 4.63 pct to settle at $61.44 and WTI surged $2.58 or 5.18% to close at $52.36 a barrel last night. Both the crude futures spiked around 17 pct during the last eight days after tumbling around 40 pct for last three months. Oil prices ripped higher on strong financial markets around the world, weak dollar and rhetoric words from Falih on supply cuts. Oil prices briefly pared gains after looking at ballooned U.S product stock numbers as reported by EIA, However Saudi oil minister's comments on supply cuts offset the bearish impact.
Oil markets responded very strongly after Saudi energy minister reassured that the producers club will rein in over supplies to balance the market within 6 months and ensured further action, If required to prop up prices. One needs to keep in mind that the OPEC operates on the rule of the mob more than sound economics. For them, its more a political will. Now question is whether that political will to ensure economic plan or to keep the cartel on board to agree upon the policy made by the spearhead. So be cautious. Asian markets are trading in red today. Good day.
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