As oil rally continue to defy the negative
sentiments surrounding the major economies, the lever system that hoists it got
yet another boost from the weakening dollar.
The price of crude oil is at a 10-month-high, having
suffered terribly during the first wave of the pandemic; it even forced the
academics to rewrite the history, when the price went negative for the first
time ever on April 20th.
The recovery has been fairly steady since October
2020, despite the outbreak of the Coronavirus across the world at varying
rates. The success of vaccines, however, managed to lift up the mood of the
investors and analysts that continue unabated.
The production cut by the OPEC+, for certain,
boosted the price. In addition, the following factors helped too:
- Significant inventory draw
- The rise in rig count
- Heavy demand in Asia
- Onset of cold weather fronts in Europe and America
- Relative calm in the Middle East
The latest boost from the weakening dollar keeps the
price of crude oil in robust bull territory.
The markets, however, must be watching the new US
administration and how they plan to tackle the environment impact at global
level. Until then, nothing will stop the momentum of the oil rally.
