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Crude futures bounce back Monday

By Daniel Tyson

20:02, 29 November 2021

Illustration of crude oil futures
Crude oil futures bounced back - Photo: Shutterstock

Oil prices rebounded Monday, gaining back some of their losses after a new coronavirus variant sent crude prices down to its worst trading session since April 2020.

US Crude advanced 4% to $70.89 a barrel at 1:30 pm EDT (UTC-5), bouncing back with other commodities and the stock market after a selloff Friday caused by the Omicron strain of the coronavirus. Oil was down 13% Friday, but still retained a year high of approximately 45%.

As bad as the selloff was on Friday, the price of oil is still substantially above where it was a year ago. Light volume and the Thanksgiving Day holiday trade that is notorious for sharp selloffs are at play,” according to Phil Flynn, senior energy analyst at Price Future Group.


Crude investors and traders are still watchful of the Omicron variant which can cause massive lockdowns, and is shutting down travel and the global demand for fuel. Since March 2020, when the first wave of Covid slapped the world, oil has plummeted whenever a new variant emerged. Then, a short time later, the price would rebound when demand picked up.

Analysts are predicting similar action playing out with the fast-spreading Omicron variant. Declared a “variant of concern” by the World Health Organization’s technical advisory group, the new strain has sparked fresh travel restrictions around the globe. Some countries, including Japan, have already put in place global travel restrictions, others, like the US, Canada and Britain, have restricted travel from southern Africa.


Some traders said they expect OPEC+ to delay projected supply increases. This summer, the cartel agreed to increase production by 400,000 barrels a day until September of next year.

“With uncertainty over Omicron, we expect that OPEC will shelve its target to increase output in January and keep its quota flat,” Morgan Stanley analysts said in a note.

Oil - Brent

75.98 Price
+2.030% 1D Chg, %
Long position overnight fee -0.0174%
Short position overnight fee -0.0045%
Overnight fee time 22:00 (UTC)
Spread 0.045

Oil - Crude

71.41 Price
+2.320% 1D Chg, %
Long position overnight fee -0.0204%
Short position overnight fee -0.0015%
Overnight fee time 22:00 (UTC)
Spread 0.030

Natural Gas

2.52 Price
-0.450% 1D Chg, %
Long position overnight fee 0.0718%
Short position overnight fee -0.0937%
Overnight fee time 22:00 (UTC)
Spread 0.0050


23.02 Price
-3.350% 1D Chg, %
Long position overnight fee -0.0204%
Short position overnight fee 0.0122%
Overnight fee time 22:00 (UTC)
Spread 0.020

Meanwhile, OPEC has postponed its technical meeting as members figure out how severe this new strain is.

“We believe that it is more than likely to decide to delay its production increase despite reports that OPEC Plus is just watching market conditions,” Flynn said.

Bright future

Oil futures were down Friday, but some analysts are still forecasting $125 a barrel in 2022 and overshooting to $150 in 2023 with OPEC+ “firmly in the driver’s seat,” according to JP Morgan’s analysts.

OPEC “has returned to a position of positive leverage, which it will defend by keeping inventories low, the market in balance and taking action to support optimal reservoir management through paced volume growth,” the analysts said in a Monday note.

Also, at 1:30 Monday, Brent was up 2.9% to $74.83, while gasoline was up 3.9% to $2.10 a gallon. While natural gas continued to drop by 10% to$4.88 per million cubic feet.

Read more: Gas prices remain volatile, oil prices rebound from panic

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The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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