Increase in futures contracts by black gold rescue?

25 February Trump on his Twitter expressed dissatisfaction with the activities of the OPEC concern and increased oil prices. This caused a significant movement of the price of this raw material. In addition, "confusion" on the market introduced information flowing from Saudi Arabia. The country wants to reduce oil production to the level of 500 thousands of barrels a day in March. After both information, we could observe a significant discount. What's more, Venezuela and Iran are struggling with production due to US sanctions. An additional brake is the civil war in Libya, which still effectively limits domestic production.

Check it out: Brokers Offering Crude Oil Trading - Fact Sheet

Nevertheless, the situation has been improved by news from futures contracts concluded for oil, as well as speeches made by representatives of the fuel industry during the International Petroleum Week conference in London. They proved to be an effective support for the price of black gold. Important information influencing the foundations of the raw material will be a weekly report of the American Oil Institute, which will be released soon.

Increases on futures contracts optimistically reverse the exchange rate

On Monday, despite the unfortunate statements of US President Donald Trump, oil prices plunged rapidly. The signal for OPEC was unequivocal not to limit supplies on the global market. The crowning argument supporting the president's words was the fact that the world economy is too "fragile" to withstand the rise in prices.

Quotations on futures have improved significantly. Growth on US West Texas Intermediate oil (WTI including deliveries scheduled for April) saw 0,3%. Brent oil futures were increased by 38 cents. As a result, the London Stock Exchange has improved by 0,6%. They also gain futures for gasoline by about 0,8%.

Since the beginning of the year, crude oil has improved its quotations by almost 22%. Nevertheless, the tweet of the US president showed how the overloaded market reacts to this type of information.

Brent crude oil chart, H4 interval