Oil prices in New York continued a strong upward trend, driven by major oil producing countries’ measures to freeze oil production in April and strong U.S. employment indicators.
On the 5th, on the New York Commercial Exchange, the price of West Texas crude oil (WTI) for April closed at $66.09, soaring $2.26 (3.5%) per barrel.
WTI surged by 7.5% this week.
Crude oil market participants watched the impact of OPEC+’s decision to extend production cuts and US employment indicators.
Oil prices continued to rise as OPEC+ decided to maintain oil production in April at a meeting the previous day at almost the same level as it is now.
As the outlook that OPEC+ would increase oil production was dominant, the impact from the unexpected decision is not small.
In particular, Saudi Arabia’s willingness to boost oil prices, which voluntarily cut production of 1 million barrels a day, in April is drawing attention.
Accordingly, major financial institutions are raising their oil price forecast one after another.
Goldman Sachs raised its forecast for Brent oil to rise to $75 per barrel in the first half of this year and to $80 in the second half of this year.
UBS also raised the Brent oil forecast for the second half of this year to $75 per barrel and the WTI forecast to $72.
The favorable US employment index also accelerated the rise in oil prices.
The U.S. Department of Labor announced in February that employment in the non-agricultural sector increased by 379,000.
This was more than the market estimate of 210,000 people increased by the Wall Street Journal.
In January, employment also increased from 49,000 to 166,000.
The unemployment rate also fell to 6.2% from 6.3% last month.
It was lower than the market forecast of 6.3%.
There were clear signs of a recovery in employment, such as a large increase in employment in the leisure and hospitality sectors, which were hit by the new coronavirus infection (Corona 19).
As a result, confidence in the rapid recovery of the economy has strengthened.
This is a factor raising expectations for crude oil demand.
Meanwhile, the number of crude oil mining equipment operating in the United States this week, announced by crude oil drilling company Baker Hughes, reached 310, an increase of one from last week.
Crude oil market experts predicted that the upward pressure on oil prices would continue due to the improvement of the economic outlook.
“The employment indicators are fueled by the claim that the world’s largest economy is recovering relatively strongly from the pandemic,” said David Maden, researcher at CMC Markets. “The demand for crude oil will increase.”
/yunhap news