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Crude Oil Rallies on Risk Appetite, Supply Concerns

April 1, 2019 at 10:53 by Vladimir Vyun

Crude oil rallied today after China’s macroeconomic data turned out to be surprisingly good, easing fears about potential global economic recession. Performance of crude is directly tied to economic growth as expanding economy means higher consumption of energy and fuel. Therefore, good economic news tends to bolster prices for the commodity.

Supply concerns were an additional factor that was supporting crude. US sanctions against Iran and Venezuela as well as voluntary oil production cuts by the Organization of Petroleum Exporting Countries and its allies can led to reduction of global supply. Meanwhile, Baker Hughes reported that US drillers reduced the number of oil rigs by 8 to 816 last week. That was the lowest level in almost a year.

Contract for delivery of WTI crude oil in March gained 0.71% to $60.57 per barrel as of 10:35 on NYMEX today. June Brent crude climbed as much as 1.26% to $68.43 per barrel on ICE.

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