Markets Congest Without Strong Direction
September 9, 2021
The energy market continues to congest and whipsaw back and forth with no trend.
It was reported that hedge funds purchased petroleum positions last week at the second-fastest rate this year.
The energy market continues to struggle with several events that are impacting prices. One is the fact of demand worries out there as the COVID-19 cases continue to cause issues. These demand issues are being offset to some degree by the fact that roughly 80% of crude production remains offline due to Hurricane Ida. The fact that Saudi Arabia cut its official selling price for its crude oil to Asian customers point to slow demand there due to virus issues. The poor jobs number in the US last Friday was also blamed on COVID. Bad economic news and with it a weak outlook for demand, which should be bearish energy prices is being held off by the lower production issues caused by the hurricane.
The US Dollar continues to rise and that puts selling pressure on energy prices.
The head of Russia’s Lukoil, Vagit Alekperov, said that oil prices of $65 to $75 were “comfortable” for consumers and that the OPEC+ group of leading oil-producing nations was striving to maintain that price range by regulating output.