http://newsrepublica.com/opec-announced-fall-crude-oil-prices/
Dwayne Buzzell

Fundamental outlook for the crude oil: 19th-23rd Dec

There has been a massive confusion in the financial industry about the U.S interest rate hike decision from the very beginning of this year. However, things have settled down to great extent in the global market as the FED declared 25 basis point hike in their interest rate in the last FOMC meeting minute. The last two-month economic performance was extremely great and investors and things were further strengthened upon the declaration of increased fiscal spending and tax cuts policy from the newly elected U.S president Donald Trump. The dollar gained a strong solid platform in the global economy after such a strong step and the dollar index significantly rose in the market. However, the dollar slipped against its all major rivals in the New York trading session after bad economic news release of the building structure. This sudden slipped in the dollar strength caused a decent rally in the price of oil. Most importantly the CFDs market also became volatile in the last trading session on Friday. In the last week, there has been a decent rise in the oil price and on the event of poor performance of the U.S economy in the last Friday the oil market managed to close with a positive gain the market. The price of Brent crude went up in the market by 2.2% and settled at $55.21 a barrel in the ICE which is often known as the Futures Exchange in London. Currently, the oil price is looming high with an initial target of $ 57.89 in the market. In the London, the Brent futures also rallied hard with a gain of 88 cents in the market. The rallied caused a 1.6% gain in the last week which is pretty strong in the oil market. The crude oil also traded higher in the global economy resulting $52.95 a barrel. The gain was near about 1.9$ in the market which is more than 98 cents according to the February contract.

There has been also a sharp rise in the in the oil futures in the New York causing a rise of 40 cents in the global market. The rise exceeded 0.8% gain in the market which is the strongest rise after the OPEC declared the oil production capping program. Previously the energy sector was compromised with the dropping oil price but after the limitation imposed by the OPEC leading members, the energy sector was stabilized along with the CFDs market. The OPEC declared that the oil cap should not exceed 1.2 million barrels per day which should be effective immediately in the global market. Such a drastic action from the OPEC member has not been seen in the global market since 2008.Most of the leading oil producers in the world have appreciated such an action from the OPEC leading board member as it eventually brought stability in the oil price. However some the leading oil-producing countries like Libya and U.S not adhering to this statement as they were supposed to do in order to maintain the energy field stability in the market. According to the oil field service provider, Baker Hughes the number of oil rig drill in the U.S sector has jumped from 12 to 510 after this capping. Such a huge increment in the oil rig section definitely an alarming situation for the global market since the market has not such sudden increase in the oil production from the U.S for almost a year. On the contrary, Libya is offering much more promise to OPEC statement as they are not producing 200,000 barrels per day in order to restore the stability in the energy price in the global market. Currently, the market is patiently waiting for the major economic news release on the crude and refined products since it will help them to measure the current demand oil from the global economy. However, most of the leading oil producing countries in the world are happy to see the price stability in the oil price and they are readily accepting the terms oil cap imposed by the OPEC member in the last OPEC meeting.

The next is week going to play an important role in the crude market since American Petroleum Institute will release the U.S oil supplies data on Tuesday. Followed by the release of this news the U.S energy information Administration is going to release their important data on oil and gasoline stockpile. If both the data comes in favor of the oil market then we will see a decent rally in the oil market in the next week. However, the CFDs market will exhibit less volatility in the next week due to upcoming Christmas holiday. On the other side, the cords traders are already sitting on the sideline since they are thinking that the market has offered all the possible things to the traders for this year.SO they are patiently waiting for the year 2017 to start fresh trading in the financial industry. The recent performance of the U.S economy is also challenging the price of oil market since the market sentiment is extremely bullish at the current moment. However, the U.S economy needs at least two hikes in the next year in order to retain its strength in the global economy. Most importantly the central bank will also pressurize the FED for the rate hike in the next year. But two consecutive rate hike would be extremely difficult for the FED since the U.S economy needs to out beat the forecasted fundamental data in every possible sector in the financial industry.

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