CRUDE OIL FUNDAMENTAL FORECAST 1Q 2021 - TALKING POINTS
Crude oil prices have ripped higher over the last month and a half. Outlook for the commodity has improved considerably as global GDP growth projections continue to recover. This is because the path of the global economy - and crude oil prices - hinge largely on the course of the pandemic due to its widespread impact on mobility and consumption.
Coming Soon! Download our detailed 1Q-2021 forecasts going live Monday at our Free Trading Guides Page[2]!
Welcomed vaccine developments, like Pfizer and Moderna both reporting over a 90% effectiveness in stopping the spread of COVID-19, have provided markets with reason to be optimistic. Nevertheless, it is noteworthy that uncertainty and downside risks still loom large.
CRUDE OIL PRICE CHART: WEEKLY TIME FRAME (SEP 2019 TO DEC 2020)
Chart by @RichDvorakFX[3] created using TradingView[4]
Most prominent is potential for widespread lockdowns to return in the wake of the 2020 winter holiday season. Vaccine rollout hiccups could prompt an abrupt rise in the VIX ‘fear-gauge’ and correspond with a materially bearish reaction across risk-assets such as crude oil. Furthermore, OPEC and its allies may soon opt to increase production, which could negate the positive impact rising demand has had on crude oil prices.
-- Written by Rich Dvorak[5], Analyst for DailyFX.com[6]
Connect with @RichDvorakFX[7] on Twitter for real-time market insight
