Crude Rallies Above Yesterday's High Despite USD Strength

Crude futures are ticking above the highs from yesterday but below the peak from last week of $80.75/bbl and despite the US dollar strength today. The market continues to weigh supply concerns due to Middle East tensions against soft demand growth and amid ongoing uncertainty over the market impact of OPEC+ cuts during Q1.

• Updated monthly oil reports from IEA and OPEC this week may help to give clarity to the balance in 2024 and whether the OPEC+ output cuts can offset a potential market surplus.
• Technicals suggest the Brent Mar 24 outlook remains bearish as moving average studies continue to highlight a downtrend. Resistance is up at the Jan 12 high of $80.75/bbl and support at the Jan 3 low of 74.79$/bbl.
• Crude time spreads are also edging higher today with the Brent prompt spread just below the highs from last week, but the prompt WTI spread remains in contango.
• The WTI-Brent spread has fallen to the lowest so far this year at -5.68$/bbl.
  • Brent MAR 24 up 1.2% at 79.08$/bbl
  • WTI FEB 24 up 0.8% at 73.29$/bbl (vs Jan 12 close)
  • Brent MAR 24-APR 24 up 0.07$/bbl at 0.41$/bbl
  • Brent JUN 24-DEC 24 up 0.16$/bbl at 1.92$/bbl
  • WTI FEB 24-MAR 24 unchanged at -0.11$/bbl (vs Jan 12 close)
  • WTI JUN 24-DEC 24 up 0.17$/bbl at 1.94$/bbl (vs Jan 12 close)