fbpx

Crude's Tight Supply Fuels Rally

Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.

The price of U.S. West Texas Intermediate crude oil extended its rally to $79.57, reaching a three-month high. The recent surge in oil prices over the past four weeks has been supported by indications of reduced supplies, primarily due to output cuts by Saudi Arabia and Russia, as well as commitments from Chinese authorities to bolster their economy, the world’s second largest.

While expectations are that Saudi Arabia will extend its output cuts into September, sources indicated that Russia is likely to significantly increase oil loading in the same month, potentially putting an end to the steep export cuts they had been implementing. Meanwhile, there is uncertainty surrounding China’s ability to fulfil its policy promises.

The market is currently grappling with the balance between tightening global supply and concerns over slowing demand due to the ongoing global economic slowdown. Tuesday’s American Petroleum Institute figures revealed a surprising build of approximately 1.32 million barrels in U.S. crude stocks for the week ending 21 st of July, which could momentarily impact market sentiment if confirmed by official U.S. government data.

Crude contracts with earlier loading dates are commanding higher prices than those with later dates, indicative of a backwardation price structure that signals traders’ belief in tight supply conditions. The six-month spread for Crude is near a 2-1/2-month high.

Market participants are becoming increasingly concerned about the trend of dwindling oil supplies, and doubts about the expected drop-off in demand are dissipating. However, some economic data have tempered gains, such as a survey indicating a greater than expected contraction in business activity in the euro zone and a closely watched survey showing a slowdown in business activity to a five-month low in the United States.

A graph of stock market

Description automatically generated

Source: TradingView

Despite the monetary tightening by the Federal Reserve on Wednesday, oil prices rose on Thursday, erasing the losses from the previous session. The market’s focus remained on the expectations of tighter supplies from major oil-producing countries, with both Saudi Arabia and Russia announcing plans to further cut production in August to bolster prices by reducing global supply.

Oil prices have been considerably less volatile over the past four months than they were between 2020 and 2022. However, changes in world production and consumption could result in price changes. While in the near-term crude oil is likely to remain within the boundaries of its current trading range between $63.61 and $83.49, in the second quarter of 2023 and throughout 2024 we are likely to see higher prices as demand rises above supply. Once key resistance of $83.49 gets broken upwards, a new primary up trend would be in place targeting $90.00 first and $94.00 thereafter.

Active traders looking for magnified exposure to oil may consider our +2x Long WTI Oil and -2x Short WTI Oil ETPs.

ETPs have revolutionized the way investors gain exposure to a variety of asset classes, making investing more accessible, affordable, and transparent. These investment vehicles offer several benefits that make them an attractive choice for investors.

Investing in ETPs has never been more accessible than it is today. Our ETFs are designed to provide investors with the opportunity to diversify their portfolios and gain exposure to a wide range of assets, all while minimizing risk.

In summary, our ETPs provide a unique investment opportunity for investors looking for diversification, leverage, and liquidity. Don’t miss out on the chance to grow your wealth and achieve your financial goals.

Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.

Post correlati

Violeta-540x540-1.jpg
Violeta Todorova
Supply, demand disequilibrium and lower US rates could squeeze the non-precious metal
Supply, demand disequilibrium and lower US rates could squeeze the non-precious metal
Violeta-540x540-1.jpg
Boyan Girginov
Supply, demand disequilibrium and lower US rates could squeeze the non-precious metal
Supply, demand disequilibrium and lower US rates could squeeze the non-precious metal
Supply, demand disequilibrium and lower US rates could squeeze the non-precious metal
Q2 is poised for European stocks’ turnaround and rising interest in energy stocks
Q2 is poised for European stocks’ turnaround and rising interest in energy stocks
Violeta-540x540-1.jpg
Sandeep Rao
Q2 is poised for European stocks’ turnaround and rising interest in energy stocks
Q2 is poised for European stocks’ turnaround and rising interest in energy stocks
Q2 is poised for European stocks’ turnaround and rising interest in energy stocks
Escalation of the conflict in the Middle East threatens to derail the economic recovery.
Escalation of the conflict in the Middle East threatens to derail the economic recovery.
Violeta-540x540-1.jpg
Violeta Todorova
Escalation of the conflict in the Middle East threatens to derail the economic recovery.
Escalation of the conflict in the Middle East threatens to derail the economic recovery.
Escalation of the conflict in the Middle East threatens to derail the economic recovery.
What is an ETF? How does an ETF work? Key characteristics of ETFs.
What is an ETF? How does an ETF work? Key characteristics of ETFs.
Violeta-540x540-1.jpg
Boyan Girginov
What is an ETF? How does an ETF work? Key characteristics of ETFs.
What is an ETF? How does an ETF work? Key characteristics of ETFs.
What is an ETF? How does an ETF work? Key characteristics of ETFs.
Violeta-540x540-1.jpg
Pawel Uchman
A quick primer on leveraged instruments available in markets today.
A quick primer on leveraged instruments available in markets today.
Violeta-540x540-1.jpg
Sandeep Rao
A quick primer on leveraged instruments available in markets today.
A quick primer on leveraged instruments available in markets today.
A quick primer on leveraged instruments available in markets today.

Violeta Todorova

Senior Research

Violeta se unió a Leverage Shares en septiembre de 2022. Ella gestiona la realización de análisis técnicos, investigación macroeconómica y de acciones, y ofrece información valiosa que ayuda a la definición de estrategias de inversión para los clientes.

Antes de unirse a LS, Violeta trabajó en varias empresas de inversión de alto perfil en Australia, como Tollhurst y Morgans Financial, donde pasó los últimos 12 años de su carrera.

Violeta es una técnica de mercado certificada de la Asociación Australiana de Analistas Técnicos y tiene un Diploma de Postgrado en Finanzas e Inversiones Aplicadas de Kaplan Professional (FINSIA), Australia, donde fue profesora durante varios años.

Julian Manoilov

Marketing Lead
Julián se unió a Leverage Shares en 2018 como parte de la principal expansión de la compañía en Europa del Este. Él es responsable de diseñar estrategias de marketing y promover el conocimiento de la marca.

Oktay Kavrak

Head of Communications and Strategy

Oktay se incorporó en Laverage Shares a fines de 2019. Él es responsable de impulsar el crecimiento del negocio al mantener relaciones clave y desarrollar la actividad de ventas en los mercados de habla inglesa.

Él vino de UniCredit, donde fue gerente de relaciones corporativas para empresas multinacionales. Su experiencia previa es en finanzas corporativas y administración de fondos en empresas como IBM Bulgaria y DeGiro / FundShare.

Oktay tiene una licenciatura en Finanzas y Contabilidad y un certificado de posgrado en formación empresarial de Babson College. También es titular de una certificado CFA (Chartered Financial Analyst).

Sandeep Rao

Investigación

Sandeep se unió a Leverage Shares en septiembre de 2020. Está a cargo de la investigación de líneas de productos existentes y nuevas, clases de activos y estrategias, con un enfoque particular en el análisis de eventos y desarrollos recientes.

Sandeep tiene una larga experiencia en los mercados financieros. Comenzó en un hedge fund con sede en Chicago como ingeniero financiero, su carrera abarcó varios dominios y organizaciones durante un período de 8 años, desde la División de Prime Services de Barclays Capital hasta (más recientemente) el Equipo Index Research de Nasdaq.

Sandeep tiene una maestría en Finanzas, así como un MBA del Illinois Institute of Technology de Chicago.

Gold Retreats But Rally is Not Over

Copper Ready to Explode

Q2 2024 Market Outlook: Rocky Road Ahead

What is an ETF? (Exchange Traded Fund)

How Do Leverage Shares ETPs Trade in Multiple Currencies

Currency Impact

Build your own ETP Basket
Leverage Shares: Europe’s top leveraged and inverse ETP provider.
Main ETP benefits
Common investor questions

Get the Newsletter

Never miss out on important announcements. Get premium content ahead of the crowd. Enjoy exclusive insights via the newsletter only.