🚀 OIL is up by more than 25% in less than a month. Can this wild rally continue?
Surging OIL prices is another reflection of the vaccine euphoria that we observe on the markets these days. Hopes that effective vaccine will soon be distributed sparked huge optimism that benefited especially the “old economy” stocks but also OIL. Normalization means more traffic and that is sending OIL prices higher.
Having said that, government may need to apply even stricter restrictions to slow the pandemic in weeks to come and that means lower short-term OIL demand. In the longer run, the clear risk for prices is a return to Nuclear Deal with Iran – and bulls seems to ignore the fact that Anthony Blinken (enthusiast of the Deal) is about to become the State Secretary in Biden administration. With all of this in mind, a break of August highs (less than 2% from the current price) would be quite a challenge. Â
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