It is the first trading week of the regular session in Asia but oil price could not help but receive the heavy blow from one of the biggest consumers in the region.
India breaches the 400,000-threshold on daily Covid-19 case additions—the first country to have reached such a mark.
The world’s third-largest crude importer started the new month with grim infection reports, raising concerns on the future demand for black gold.
The administration has resorted to curtailing more economic activities in an attempt to mitigate the spread of the virus.
Along with this decision, Brent crude futures fell by 0.18%, hovering above $66.00 per barrel.
The West Texas Intermediate futures managed to follow the downhill and decreased by 0.13% to $63.50.
Both benchmarks managed to close last week with significant gains as experts have bullish price expectations over the next six months.
Goldman Sachs analysts noted that prices could surge up until $80.00 per barrel in the next six months, as the international demand continues to recover.
On the other hand, the path towards such a hike is not looking as smooth as expected, with the usual roadblock now on the line.
Nevertheless, commodity strategists noted that other key locations could make up for the slack in Indian demand, primarily led by the world’s largest economies.
Analysts are looking forward to the upbeat Chinese crude oil imports as economic activities continue to recover.
In North America, crude traders are also looking forward to an uptick in demand as the location approaches the summer season.
With swift vaccinations on the line along with the possibility of the reopening of more travel locations, the outlook is more positive than ever.
Crude Oil Trading will be Demand Oriented
Experts added that along with the bettering overall environment, crude oil trading has a bigger possibility to now become demand-driven.
In the past months, prices became heavily dependent on the decision of the Organization of Petroleum Exporting Countries and its allies.
The elite oil association resorted to adopting supply-driven measures since April of 2020 to support prices from falling to point of no return.
Now that vaccinations across the United States are continuous, so as in other big importers such as Canada and Europe, this offers a silver lining on demand.
Should such as sound performance continue, analysts noted that demand will now be the king in predicting price trajectories in the remaining months of the year.