Oil price recovers in anticipation of new economic stimuli
The price of oil is recovering from last week's falls due to the expectation that new stimuli for the recovery in the United States will be approved and Donald Trump will return to the White House after having spent the weekend in the hospital for coronavirus.
US benchmark WTI crude futures, which fell 3-4% between Thursday and Friday, are now rising to $39.44 a barrel, following yesterday's bullish trail. Brent futures, the benchmark in Europe, also rose to $41.5 a barrel.
Confidence in a recovery in demand increases with the possibility that Democrats and Republicans will agree on a new aid package to face the pandemic while concern about the state of health of the US president wanes.
The market is also waiting for the speech from Federal Reserve Chairman Jerome Powell as he could continue to pressure politicians to approve the stimulus as soon as possible.
Source: Admiral Markets MetaTrader 5. Brent daily chart. Data range: from July 1, 2020, to October 6, 2020. Prepared on October 6, 2020, at 11 a.m. Keep in mind that past returns do not guarantee future returns.
Source: Admiral Markets MetaTrader 5. WTI daily chart. Data range: from March 26, 2020, to October 6, 2020. Prepared on October 6, 2020, at 11 am. Keep in mind that past returns do not guarantee future returns.
In the last four years, oil has achieved some price recovery, but at the moment it has not been able to reach or even come close to the record prices prior to 2014, when it was between $90 and $100. Now it is struggling to move up from $40.
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