Singapore — 0221 GMT: Crude oil futures rose during the mid-morning trade in Asia March 15, as the market fell back on bullish macro fundamentals amid an absence of fresh cues.
At 10:21 am Singapore time (0221 GMT), the ICE Brent May contract was up 68 cents/b (0.98%) from the March 12 settle to $69.90/b, while the April NYMEX light sweet crude contract also gained 68 cents/b (1.04%) to $66.29/b.
Market analysts noted a lack of new drivers in the market this morning, adding that the rise in price is the result of the market buying into the narrative that an improved economic climate will push up oil demand.
“There are no specific oil-related headlines that have come up this morning. The market just wants to buy the growth recovery trade, and oil is one of the assets that it has its eye on,” Jeffrey Halley, senior market analyst at OANDA, told S&P Global Platts on March 15.
“The fundamentals for oil are good, and the market really needs no excuse to buy oil when there is a price dip,” Halley added, as he alluded to the downward price movement seen in the market at the close of week ended March 13.
Both the Brent and NYMEX light sweet crude markets ended lower 0.59% and 0.62% on the day to settle at $69.22/b and $65.61/b, respectively on March 12.
Stephen Innes, chief global market strategist at Axi, said in a March 15 note that crude prices are likely to extend gains, as US gasoline demand is on the verge of a resurgence.
“Prices should continue to dance higher into the summer, especially to the chime of gasoline pumps turning over. And given the rosy US reopening narrative, more and more folks take the highways ahead of what is likely to be the biggest pent up driving season on record as the US could reach herd immunity from COVID-19 by summer vacation time,” Innes said.
Some market analysts were a little more cautious, saying the higher prices could derail demand recovery.
ANZ analysts, in a March 15 note, said that crude prices had come under pressure last week on concerns that high prices may hamper demand. They further noted that already in India, amid higher pump prices, February fuel sales were lower.
