Crude is looking quite bullish. Last week we saw 23% gains in crude, and yesterday we saw 5% more. At this point in time, it is just kissing USD 50 per barrel in the European markets. The fundamentals are supportive.
The strength in the US dollar has really been shrugged off by crude. It is actually decoupling from that one factor. The others are quite on bullish note because there are statements coming from OPEC that a cut of 4.2 million barrels per day, which was agreed by OPEC is being implemented.
There are statements coming in from a lot of OPEC producers on that. There is deepening violence in the Middle East, there is some unrest in Nigera, Russia says it would reduce gas flows to Europe via Ukraine. All these factors are supporting the price.
Apart from that, there also has been a price increase from Saudi Arabia. As it cuts supplies, it has increased its prices in crude.
There is fog as well that has led to shipment delays. There is winter demand for heating oil that is supporting prices right now. USD 45 per barrel is an immediate support on the higher side. If USD 50 per barrel is breached today, then you might be looking at USD 52-55 per barrel in this current week itself.
