- The price of oil remains supported by the optimism that trade negotiations between the US and China will advance without problems in the future.
- The de -escalation of commercial tensions between the US and China is a favorable scenario for the price of oil.
- Investors expect US NFP data to obtain new clues about the interest rate perspectives of the Fed.
The West Texas Intermediate (WTI), futures in NYMEX, listed laterally around $ 62.20 during Friday’s European negotiation hours. The price of oil is consolidated while investors expect the data of non -agricultural payroll (NFP) of the United States (USA) for May, which will be published at 12:30 GMT.
Investors will pay close attention to official US employment data as they will influence market speculation on the monetary policy of the Federal Reserve (FED). Cooling signals in labor demand would force operators to increase the Fed Dovish bets, a scenario that will be favorable for the price of oil.
Black gold remains well backed, since the comments of US President Donald Trump in a publication in Truth.Social have indicated that commercial negotiations with China will be fluid in the future. “The call lasted about an hour and a half, and resulted in a very positive conclusion for both countries,” Trump wrote.
Meanwhile, Beijing has also confirmed that US President Trump and Chinese President Xi Jinping maintained a phone call at Trump’s request to participate in discussions and reflect the diplomatic communication ongoing in the middle of tensions, the Xinhua news agency reported.
The de -escalation of commercial tensions between China and the US is favorable for the price of oil, since China is the world’s largest oil importer.
WTI FAQS oil
WTI oil is a type of crude oil that is sold in international markets. WTI are the acronym of West Texas Intermediate, one of the three main types that include the Brent and Dubai’s crude. The WTI is also known as “light” and “sweet” by its relatively low gravity and sulfur content, respectively. It is considered high quality oil that is easily refined. It is obtained in the United States and is distributed through the Cushing Center, considered “the crossing of the world.” It is a reference for the oil market and the price of WTI is frequently traded in the media.
Like all assets, supply and demand are the main factors that determine the price of WTI oil. As such, global growth can be a driver of the increase in demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can alter the offer and have an impact on prices. OPEC decisions, a group of large oil -producing countries, is another key price factor. The value of the US dollar influences the price of WTI crude oil, since oil is mainly traded in US dollars, so a weaker dollar can make oil more affordable and vice versa.
Weekly reports on oil inventories published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect the fluctuation of supply and demand. If the data show a decrease in inventories, it can indicate an increase in demand, which would raise the price of oil. An increase in inventories may reflect an increase in supply, which makes prices lower. The API report is published every Tuesday and that of the EIA the next day. Their results are usually similar, with a 1% difference between them 75% of the time. EIA data is considered more reliable, since it is a government agency.
The OPEC (Organization of Petroleum Exporting Countries) is a group of 13 nations oil producing that collectively decide the production quotas of member countries in biannual meetings. Their decisions usually influence WTI oil prices. When OPEC decides to reduce fees, it can restrict the supply and raise oil prices. When OPEC increases production, the opposite effect occurs. The OPEC+ is an expanded group that includes another ten non -members of the OPEC, among which Russia stands out.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
