Quotes from Commerzbank Corporates & Markets:
-Oil prices managed to defy the downward pull of other commodities for quite some time yesterday before briefly dipping, though they actually ended the day's trading up. Brent fell for a time to $60.5 per barrel but then climbed at its peak to $63 per barrel, its highest level since mid-December. The performance of the WTI price was somewhat more pronounced: its price dropped for a time by a good 3% to $51 per barrel before more than making good these losses shortly afterwards.
-Yesterday's price response shows that oil prices still want to climb. The interim decline in the Brent price was below-average and was immediately recouped, as was the somewhat more marked decrease in the WTI price. Meanwhile, the price differential between Brent and WTI has widened to more than $8 per barrel, which constitutes the highest price premium since August 2014.
-A month ago, WTI was actually more expensive than Brent for a brief period. We attribute the broadening of the price gap to the development of stocks in the US, which is weighing on the WTI price. The API's data this evening and the DOE's figures tomorrow afternoon are likely to show a renewed inventory build - if so, US crude oil stocks will have achieved a new record level for the fourth consecutive week.
-Brent, on the other hand, is profiting from the renewed shift in focus towards supply risks. Libya for example is exporting virtually no more oil because all its oil terminals are now closed due to the unrest.
