OIL PRICES: Recent EventsOIL PRICES: Recent Events
The price of oil decreased substantially in 2020 due to the COVID-19 pandemic and the 2020 Russia–Saudi Arabia oil price war. On 20 April, WTI Crude futures contracts dropped below $0 for the first time in history. Oil Prices collapse into negative prices on Monday was a clear warning of just how scarce storage space for oil is getting. The following day Brent Crude fell below $20 per barrel.
"It will take time and money to turn it back on. It's not like a light switch," David Trainer, CEO of New Constructs, an investment research firm based in Nashville.
The outbreak of Coronavirus impacted the oil price as many people are staying home. The social-distancing and stay-at-home orders are thought to partly be one of the major factors that crippled the oil price market in the first place. Return of the oil boom is speculated to be coming in the next few months as the world reopen after COVID-19 lockdowns. The demand of oil is thought by experts to return and in turn increase oil prices in the coming months.
"When demand comes back online, there won't be as many people there to make the oil," said Trainer.
Profiting from a oil price CFD increase:
Let’s say you buy an oil price contract at a current market price of US$11.55 per barrel, believing the market price will rise by a certain time. If the oil price has risen at the expiry of the contract, you’ll make a profit based on the difference between the buy and sell price. However, if oil price falls below the buy price at the point when the contract expires, you’ll lose the trade.
Heikinashi Fibonacci Resistance Level: $28.77
Heikinashi Fiboacci Support Level: $0.06
