US crude oil last week
Last week, US crude oil July futures rose 0.9% and closed at $53.99 per barrel on June 7. On June 5, US crude oil prices fell to its lowest level since January 14. The S&P 500 Index (SPY) rose 4.4% last week. The rise in the S&P 500 Index and short-covering might have helped oil prices to rise. Usually, the S&P 500 Index influences oil prices.
Will oil recover this week?
At 5:46 AM EST on June 10, US crude oil prices were almost unchanged from the closing level last week. On June 10, Russian Deputy Energy minister said to Reuters that the cooperation between Russia and OPEC will continue despite any hindrances. Moreover, he indicated that the amount of production cuts will be decided by the end of June. This might trouble oil prices further this week.
Rising trade tensions between the US and China could further weaken oil’s demand growth. The IEA has already trimmed the oil demand growth forecast last month, while US crude oil weekly supply rose to a new record high for the week ended May 31.
This week, the closing level of $54.98 per barrel will be important for oil traders on the upside. However, any rise in the US crude oil inventories spread might push prices close to $50.2 per barrel. The inventories spread is the difference between US crude oil inventories and their five-year average.