Crude price gain amused many market participants for the third week. Brent and WTI managed to grow by over 5% during the week. Finally, Brent closed at $81.34 and WTI closed at $78.85 on Friday, 7 January. Technically, the price is strong enough to stay above $80 for a while. The market can face better prices unless it encounters a fundamental change.
Production and supply chain uncertainty had a huge role in oil recent growth. Kazakhstan riots over the gas price and Libya political issues popped up notions of a tighter crude supply. Iran and the US negotiations vague situation has boosted the idea. If Iran does not reach an agreement, it cannot inject its oil capacity into the market.
Demand, on contrary, is getting more promising sentiments as the holidays are over. Countries have started the booster shots as covid cases multiply. Although covid has erupted once again, governments are less worried since Omicron infections look to be the same as a casual cold with less hospitalization and deaths.
The supply and demand outlook has suspended the effect of anticipated tapering policies by the Fed. Commodities have not changed much, even though the possibility of raising the interest rates by March is getting stronger.
The petrochemical market had quite a week after the rise of crude. Prices are growing as the demand outlook improves. Traders try to have their deals at the best daily price that they can find to avoid higher prices in future.