Oil prices hit multi-month highs on Monday due to expectations that OPEC + countries could cap in February, as the coronavirus pandemic raises concerns about increased energy demand in the first half of 2021.
On Sunday, Mohammad Barkindo, secretary general of the Organization of the Petroleum Exporting Countries (OPEC), said that while oil demand is expected to rise by 5.9 million barrels a day to 95.9 million barrels a day this year, he sees many negative factors for demand in the first half of 2021. These statements have raised investor expectations that OPEC countries may tighten production restrictions or extend existing restrictions for a longer period.
At the same time, analysts at Energy Aspect and RBC Capital believe that OPEC + is likely to maintain its January production level in February.
Today and tomorrow the market will focus on the meeting of the OPEC Monitoring Committee. The meeting participants will discuss the current state of affairs in the energy market and further plans on the feasibility of changing production quotas.
On the chart, the price is approaching the psychologically important 50.00 mark. Today we are waiting for a slight breakdown of this level, after which the price may go into a deep correction.
The main scenario is a rise to 50.00 and a downward reversal.
Alternative scenario is a consolidation above 50.00 and further growth.
The current fundamental outlook is neutral. We consider shorts after quotes rise above 50.00.
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