⛽Oil reaches 7-week highs

Crude oil continues its rebound, although today's increase is limited to about 0.5% for both WTI and Brent. In the latter case, we are dealing with the rollover of futures contracts today. It is worth noting that oil is gaining despite the increase in inventories according to API, and the STEO report from the EIA, that showed lowering of average oil price forecast for this year. The June STEO report showed that WTI oil is expected to average $80.32 per barrel this year, while the May report showed an average price of $84.76 per barrel.

Why are there increases in the oil market? Firstly, we are observing a slightly weaker US dollar, and secondly, following the STEO report, investors still expect a strong recovery in oil demand during the summer season. It is also possible that OPEC+ may be forced to revise its decision at the end of the summer and extend voluntary production cuts until the end of this year.

Brent (OIL) has returned above the 50-, 100-, and 200-session moving averages and climbed to the highest level since May 1, 2024. Price has fully recovered from a drop triggered by OPEC+ meeting at the start of June. The nearest significant supply zone can be found between $87 and $88 per barrel. Source: xStation5

It is worth noting that at the end of May, Brent oil nearly reached contango on the nearest two contracts. Since then, however, there has been a strong rebound of the price of the nearest futures contract relative to the next one. Source: Bloomberg Finance LP, XTB