Oil prices surged above $90 last week due to a combination of strong investment flows, bullish fundamentals, and expectations of higher demand in the second half of the year.
Fundamentals and geopolitics pushed oil prices to above $90 per barrel last week as more market participants have become bullish on crude. After sitting on the sidelines in a more risk-off approach for nearly a year, a growing number of financial market participants now believe that oil is a buy, according to Mike Muller, Head of Asia at the world's largest independent oil trader, Vitol.
The combined net long in Brent and WTI, the most traded contracts, jumped to a six-month high, while the net long position in Brent Crude surged to the highest level in two and a half years, according to the data compiled by Saxo Bank. Oil may have room to run up to $100 a barrel, especially if OPEC sticks to its guns and rolls over the cuts further into the second half of the year when demand is expected to be very strong.
Oil Prices Fundamentals Brent WTI Risk Geopolitics Supply Demand
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