Oil Marks Anniversary of Crash Below Zero With Rally Above $64 - Bloomberg

Oil Marks Anniversary of Crash Below Zero With Rally Above $64 - Bloomberg

• WTI for May delivery rose 1.1% to $64.08 a barrel on the New York Mercantile Exchange at 7:28 a.m. in London.
• Brent for June settlement was up 1.1% at $67.77 a barrel on the ICE Futures Europe exchange.
• The Bloomberg Dollar Spot Index was 0.1% lower; its run of seven daily declines is the longest losing streak since June.

Oil surged above $64 a barrel a year to the day after futures for the U.S. benchmark collapsed below zero, with the world’s most important commodity extending a powerful rally on bets for better demand as leading economies battle the pandemic. The gains were aided by a weaker dollar.

West Texas Intermediate surged 1.1%, extending Monday’s modest climb, and last week’s significant jump. In the U.S., refinery runs have climbed to the highest in over a year as activity picks up, with that optimism overshadowing concerns that demand in India is suffering amid a fresh wave of infections. An additional boost for crude came from the drop in the dollar, which fell for a seventh session, boosting the appeal of commodities priced in the currency.

Crude is up more than 30% in 2021 as investors bet the reopening of economies will stoke consumption and keep draining global inventories. As demand picks up, the Organization of Petroleum Exporting Countries and its allies are planning a cautious return of some supply from next month. The OPEC+ grouping may skip a full-scale ministerial meeting planned for next week, possibly indicating members don’t see much need to revise current strategy.

“If prices sustain in the current band, they wouldn’t want to make any changes to what’s been agreed for May-July,” said Vandana Hari, founder of Vanda Insights in Singapore. Still, “crude appears to be under-pricing the risk of a demand slowdown in India and Europe countering gains in the U.S.,” she said.