According to Motilal Oswal, Crude oil situation looks more and more of compressed spring ready to shoot up despite the cautious demand recovery.
Motilal Oswal's report on Energy Weekly
Crude prices ended the week on the back foot with prices not rallying in response the latest demonstration of OPEC+ which to be supportive for prices as the coalition continued to put a strong focus on compliance and compensation cuts as global economy continues to falter due to renewed COVID restrictions in some vital economic hubs around the world along with strength in Dollar Index which kept the pressure on prices.
Outlook
Crude oil situation looks more and more of compressed spring ready to shoot up despite the cautious demand recovery. At the same time, inflation in the USA, as well as in the whole world, has already reversed upward. US data surprised with a spike in the core price index (excluding food and energy). This is often a sign of healthy consumer demand. Multiple increases in oil prices often accompany periods of higher inflation, and markets may well be at the start of one of these periods.
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