Oil Rises on Trade Hope and Dollar Softness

Oil is higher at the start of the trading week. The US dollar is softer giving crude some upward momentum. Brexit uncertainty after Prime Minister May’s third attempt to get her proposal through was a failure is on the rise as a long extension could mean the end of the divorce proceedings.

West Texas Intermediate graph

The OPEC+ agreement to limit production has been the stabilizing force despite rising US production. Sanctions on Venezuelan and Iranian exports have reduced supply and lifted prices. Venezuelan exports are set to rise after its largest terminal is back online after an electricity blackout caused it to shut down last week.

The timing couldn’t be worse for the Maduro government as it struggles to remain in power after international support to opposition leader Juan Guaido.

Brent crude graph

West Texas Intermediate is trading above $60 ahead of a busy week for markets. Energy demand could be impacted if global growth concerns rise again on US-China trade anxiety. So far negotiations appear to be moving ahead, but there are few details on concrete concessions

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza