After gaining for two consecutive trading weeks, crude oil prices continued to strengthen and traded higher in the early hours. Increased optimism about a supply cut agreement extension supported crude oil prices.
The crude oil market is looking forward to producers’ meeting in Vienna on May 25. The supply cut agreement that came into action since the beginning of 2017 didn’t have an impact amid increased inventory levels and US shale oil production. However, optimism in the market improved after statements from oil producing nations’ energy ministers. The statements supported the extension of the supply cut agreement with the possibility of deeper supply cuts. The market is also looking forward to the American Petroleum Institute and U.S. Energy Information Administration’s crude oil inventory data this week.
At 6:30 AM EST, West Texas Intermediate crude oil futures contracts for July 2017 delivery were trading at $51.09 per barrel—a gain of ~0.83%. Brent crude futures contracts for July 2017 delivery rose ~0.8% and were trading at $54.03 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $35.52 after rising 2.4% on May 19.
After regaining strength last week, copper prices are stable in the early hours. The sentiment in the copper market improved amid China’s announcement of the “Silk Road” project with infrastructure spending of $124 billion last week. The PowerShares DB Base Metals ETF (DBB) rose 2.5%, while the SPDR S&P Metals & Mining ETF (XME) rose 1.9% on May 19. Gold (GLD) is trading with mixed sentiment in the early hours amid optimism in Asian markets and political concerns in the US. Silver (SLW) and platinum are stable in the early hours, while palladium is weaker.