WTI Updates Post-Pandemic Highs at $ 47.72 as Bulls Ignore Short-Term Lockdown Fears

• WTI is trading decent gains on Tuesday as markets focus on vaccine optimism and fiscal stimulus.
• First-month WTI futures coincided with last week’s post-pandemic highs of $ 47.72 early in the session.

First month’s WTI futures have traded higher on Tuesday, with prices rising throughout the day from below $ 47.00 during Asia Pacific hours to current levels not far below the recently established daily highs of $ 47.72. In fact, Tuesday’s high coincided with the WTI post-pandemic high set last Thursday.

Crude Oil Markets Ignore Short-Term Demand Risks
With Covid-19 cases on the rise in Europe and the United States still, the short-term risks to the demand for crude oil are growing. In fact, on Tuesday, the Italian Prime Minister said additional Covid-19 restrictions would need to be adopted over the next few weeks to prevent a third wave, putting Italy on track to join countries like Germany and the Netherlands in imposing Tighter blockade restrictions that will reduce European demand for fuel in the coming weeks.

Furthermore, in the latest monthly oil market report from the International Energy Agency, the agency cut its forecasts for global oil demand for 2020 and 2021 by 50,000 and 170,000 barrels per day, following in the footsteps of recently released monthly reports. from OPEC and the US Energy Information Administration with the report directly citing a drop in European demand amidst the continents returning to lockdown. As expected, the report also downplayed the positive impact on oil markets that the start of mass vaccinations will have in the coming months, given that herd immunity and return to normal life are unlikely to take place much sooner. of the second half of 2021.

But none of the events described above appear to have clouded the mood for crude so far on Tuesday. Indeed, oil markets have seen a rise, with analysts citing the usual cocktail of bullish catalysts, such as stimulus hopes and vaccine optimism.

“There is a lot of bullish sentiment that has crept into the oil market with the launch of the vaccine,” John Kilduff, partner at Again Capital LLC, John Kilduff, told Bloomberg News, adding that “if we get a fiscal aid package it would be from Washington, that would further strengthen markets across the board. “

The latest US vaccine and stimulus talks.

Starting with the latest news on US stimulus; Late on Monday, the bipartisan group of U.S. lawmakers announced the details of its latest two-part proposal, which was divided into a $ 748 million package containing the aspects of aid that both Republicans and Democrats can agree to, including an extension of $ 300 per week. to unemployment insurance benefits, as well as a separate $ 160 billion package containing state / municipal aid plus liability protections (the things the two major US parties cannot agree on).

Neither Democrats nor Republicans have indicated that they are willing to back the bipartisan proposal for now, but the Speaker of the United States House of Representatives, Nancy Pelosi (leader of the Democratic majority in the House) has invited the leader of the Republican majority in the Senate, Mitch McConnell, as well as the House. and Senate Minority Leaders Chuck Schumer and Kevin McCarthy to discuss ending government funding and Covid-19 relief at 9:00 PM GMT.

Regarding the latest news on vaccines, the European Medical Agency will decide on the approval of the Pfizer / BioNTech vaccine on December 21, and it was reported separately that, if approved, vaccines could start on the continent before 26 December. December. Note that the EU is expected to approve the vaccine as it has already been given the green light in the UK and US.

There were also some positive updates regarding the Modern Covid-19 vaccine’s path to FDA approval; The FDA released its information documents for the vaccine and concluded that the vaccine is 94.1% effective (as stated by Moderna), that Moderna’s data does support a favorable safety profile, and no specific safety concerns have been identified that would prevent emergency use authorization.