By Srinivas Chowdary Sunkara // petrobazaar // 13th January, 2022.
Brent oil futures for March delivery rose 95 cents or 1.13 pct to close at $84.67 a barrel on London based ICE futures Europe exchange. WTI oil Feb futures prices advanced $1.42 or 1.75% to settle at $82.64 a barrel on NYMEX last night. In Shanghai, Crude oil main contract futures prices went up 12.5Yuan to 518.4Yuan/bbl while MCX crude oil front month futures prices closed Rs.104 higher at Rs.6108 a barrel yesterday. Brent premium over WTI narrowed down to $2.03 a barrel during the yesterday's session.
The world crude oil price index curves continued to hover upside yesterday on tightening supplies and easing concerns over potential impact of Omicron coronavirus variant. Both the benchmark futures continued to add gains to previous session's margins followed by strong financial markets, Yesterday. Weaker dollar also lent support to oil complex. Brent six month contract continued to show widening backwardation with front month delivery is around $4.2 more expensive than delivery in six months that indicates tighter supplies going forward.
On the data side, EIA data showed draws in U.S crude stocks by 4.6Mbpd while gasoline and distillates stocks were piled up by 8Mbpd and 2.5Mbpd respectively that showed dent in fuel demand amid surging virus cases. U.S drillers reduced domestic production, Net crude imports ticked up with exports dampened. Turning to monthly reports, IEA says that demand dynamics are proved to be stronger than many of the market observers had thought, Mainly due to the milder Omicron expectations. The agency further said that some of OPEC producers face serious supply disruptions that may tighten supplies in future.
Today, Asian markets opened down, Clawing back some of the previous sessions margins. Less Bullish weekly numbers and uncertainty over prevailing worries over near-term demand outlook amid rising virus cases keep weigh on oil prices.
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