Crude Oil Prices Are Increasing While Supply Remains Tight

crude oil

This week’s crude oil prices are looking good, even as the market anticipates a rate rise after the Federal Reserve meeting on Wednesday.

The efforts of the Fed to suppress damaging inflationary outcomes appear certain to lead to an economic slowdown. The debate is centered around the potential recession.

A slowdown in the world’s largest economy usually sees crude fall under selling pressure with low demand. However, due to supply constraints, WTI has remained relatively buoyant, which is a problem for oil traders.

A hint of underlying supply and demand dynamics within the oil market is backwardation.  This occurs when the contract closest to settlement is more expensive than the contract settling after the first. It shows the market’s willingness to pay more to have immediate market delivery. Backwardation has been on the rise before the invasion of Ukraine by Russia. The recent backwardation is fostered more by supply frailties rather than recession.

Political unrest caused OPEC members’ oil production falls under 600,000 barrels per day since April. Mohamed Oun, the Libyan oil minister, announced that production is back to over 1 million barrels per day after coming to terms with opponents. This development is good news for oil consumers during a period when OPEC experienced difficulties meeting its production targets.

The USD (DXY) index has been sliding in the past weeks, which might have encouraged crude oil to rise at the beginning of the week.

This Post Has 7 Comments

  1. Joana

    I’ve been browsing online greater than 3 hours these days, but I by no means found any attention-grabbing article like yours. It is lovely worth enough for me. In my view, if all site owners and bloggers made excellent content material as you probably did, the net can be much more useful than ever before!

  2. Bud

    I’ll immediately take hold of your rss feed as I can not to find your e-mail subscription link or e-newsletter service. Do you have any? Kindly allow me recognize so that I may subscribe. Thanks!

  3. escape room list

    Hey there! Do you know if they make any plugins to assist with SEO?

    I’m trying to get my blog to rank for some targeted keywords but I’m not seeing
    very good results. If you know of any please share. Thank you!
    You can read similar blog here: Escape rooms list

  4. Scrapebox List

    Hello! Do you know if they make any plugins to help with Search Engine Optimization? I’m trying to get my website to rank for some targeted keywords but I’m not seeing
    very good gains. If you know of any please share.
    Thank you! I saw similar article here: Backlink Portfolio

  5. sklep online

    Hi my friend! I wish to say that this article is amazing, great written and come with almost all important infos.
    I’d like to look more posts like this . I saw similar here: Sklep

  6. najlepszy sklep

    Wow, wonderful weblog structure! How long have you been blogging for?

    you made running a blog glance easy. The whole look of your website is fantastic, as smartly as the content
    material! You can see similar here najlepszy sklep

Leave a Reply

Important Link

Fund Your Deriv Account
Withdraw Funds to Your Local Currency
VIP Trading Signals
Learn To Trade

Contact Us

Follow Us


Forex, Crypto, Options, and Binary Options have both large potential rewards and large potential risks. Therefore, before investing or trading any of the assets, ensure you are aware of and willing to accept the accompanying risks. Do not trade money you cannot afford to lose.

All Rights Reserved. None of the content of this website can be published elsewhere by any means without the prior consent of the owner(s). Please, check our terms & conditions and privacy policy before continuing to use this website.

This website and its owner(s) are not in any way liable for any incurred loss, whether caused by the information provided on this website or otherwise. The use of this website, including the content and information provided, is the user’s sole liability.