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Crude Extends Rally on Supply Fears

OIL

Crude front month extends the rally above the highs from yesterday and towards the high of the year with supply risks from Middle East and Libya offsetting the US dollar strength in reaction to the US CPI data.

  • Front month crude has seen support today with rising Middle East risks after the hijack by Iranian military on an oil tanker carrying Iraqi crude oil to Turkey.
  • Near term crude spread continue to rally the WTI prompt spread once again back at parity after briefly trading in backwardation a couple of time this week. The WTI-Brent spread has closed slightly to -5.22$/bbl.
  • Technicals suggest the first resistance for Brent March 24 contract at Jan 4 high of $79.41/bbl and support at the Jan 3 low of $74.79/bbl.
    • Brent MAR 24 up 2.7% at 78.86$/bbl
    • WTI FEB 24 up 3.2% at 73.62$/bbl
    • WTI-Brent up 0.13$/bbl at -5.24$/bbl
    • Brent MAR 24-APR 24 up 0.06$/bbl at 0.41$/bbl
    • Brent JUN 24-DEC 24 up 0.25$/bbl at 1.93$/bbl
    • WTI FEB 24-MAR 24 up 0.06$/bbl at -0.01$/bbl
    • WTI JUN 24-DEC 24 up 0.32$/bbl at 1.96$/bbl

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