Crude oil and OPEC output cut trending points
- Crude oils are shredding off their earlier losses, and the global economic slowdown seemed to have little impact on crude price, as OPEC and Non-OPEC output takes place.
- The Saudi led, OPEC had posted their biggest production drop since 2016, as both US and Brent crude price started to ignite
- Despite a slowdown led by faltering Chinese economy and a flash crash in the Forex market, the crude market appeared to be heavily protected
Crude oil prices holding their ground
While demand for safe-haven currencies like Yen and Swiss Franc as well as commodities like gold had been raising, the crude outlook appeared to be stable, despite a global scale economic slowdown.According to a Bloomberg News Agency Survey, released on Wednesday, the 2ndof January, 2019, the production of Saudi Arabia, the kingpin of OPEC and second largest oil producer in the world, dropped by 4,20,000 barrels, which was its biggest since January 2017. As an aftermath, the crude price started to breeze through, amid garrulous cloud over the global market.
Crude oil five minutes trading chart (January 2nd-3rd)
The five-minute trading chart above showed the radical impact of Saudi Arabia’s production cut in to the crude oil market, and the chance of improving market outlook seems to be brighter, as the agreed output cut of 1.2 million barrel per day, had already been applied from January 1st, 2019, given the fact that the OPEC and non-OPEC oil producing nations had agreed to a much-anticipated output cut over the latest OPEC summit in Vienna, Austria, in the December 7thevening, after two days of discussion.
While this report was being prepared, the 3rdof January, 2019, GMT. 16.00, the US crude had been trading at $46.72 per barrel, and the Brent Crude was trading at $55.42 a barrel. Both US and Brent crude were over 0.50 percent up during the preparation of this report.
Despite continuing concerns regarding a weakening global demand and solid signs of supply glut, the crude market remains stable and a continuous swing upwards appears to be possible, in the wake of upcoming impacts of the agreed 1.2-million-barrel output cut per day.
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[Disclaimer: The content of this article is personal opinion and should not be considered as investment advice or suggestion towards any trading activity.]