- Crude oil futures were slightly higher in mid-morning trade in Asia Dec. 28, extending strong overnight gains.
- Key US equity indices were seen closing at fresh record highs overnight.
- Oil demand in Asia has been rebounding in recent months as economies continue to recover from the COVID-19 hit.
Crude oil futures were slightly higher in mid-morning trade in Asia Dec. 28, extending strong overnight gains…., says an article published on sp global website.
Strong overnight gains
Crude oil futures were slightly higher in mid-morning trade in Asia Dec. 28, extending strong overnight gains, as an upbeat mood from the festive period continued to boost risk sentiment despite still rising COVID-19 cases in some parts of Europe and the US.
At 10:05 am Singapore time (0205 GMT), the ICE February Brent futures contract was up 6 cents/b (0.08%) from the previous close to $78.66/b, while the NYMEX February light sweet crude contract rose 18 cents/b (0.24%) at $75.75/b.
Risk sentiment remains buoyant
Risk-on sentiment in the broader financial markets continued to drive asset prices higher though COVID-19 cases were still climbing in the West.
Key US equity indices were seen closing at fresh record highs overnight, while the front-month ICE Brent and NYMEX light sweet crude contracts settled higher by 3.2% and 2.4%, respectively. Both benchmarks were at highs not seen since Nov. 26.
Trading volumes are expected to remain thin for the remainder of the week with most market participants away for the holidays.
Oil demand in Asia rebound in recent months
Oil demand in Asia has been rebounding in recent months as economies continue to recover from the COVID-19 hit.
India’s crude imports in November hit its highest level in 10 months, latest provisional data from the country’s Petroleum Planning and Analysis Cell showed, as refiners build inventories in anticipation of higher run rates.
“China and India will resume their front-line status in being the engines of growth in 2022, but Southeast Asia will also contribute substantially, especially in countries with high vaccination rates,” S&P Global Platts Analytics said.
In the US, crude inventories are expected to have fallen by 5 million barrels to 418.6 million barrels in the week ended Dec. 24, according to analysts surveyed by Platts.
US gasoline stocks, meanwhile, are expected to fall by 150,000 barrels over the same period and distillate stocks to climb by 580,000 barrels.
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Source: sp global
