CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English

Supply shortages relieve downward pressure on energy prices

By Jenal Mehta

11:16, 22 December 2021

Aerial view offshore drilling rig (jack up rig) at the offshore location during sunset
Despite a small uptick in oil production, demand continues to outpace supply, putting a dampener on downward price pressures – Photo: Shutterstock

The value of oil has recovered from the gradual losses it had accumulated since the end of last week – around 3% – due to dampened prospects over lockdown fears. Brent Crude Oil and US Crude Oil traded at $74.29 (around £55.80) and $71.52 per barrel respectively. Elsewhere, US Natural Gas traded at $3.91 per million British thermal units, a slight rise on yesterday.

According to a report published by the American Petroleum Institute (API), crude oil inventories fell to their lowest levels since 2014 in November. Despite increasing production by 100,000 barrels to 11.6 million barrels per day, its highest figure since April 2020, demand has continued to outpace supply.

The US Energy Information Administration (EIA) expects the imports of crude oil to increase in 2022 in the United States, further highlighting the disparity between demand and supply.

Russian gas supplies to Europe also fell on Tuesday, as reported by Reuters. This has resulted in the region switching to oil to meet its energy demands, placing further limits on any downward price pressure on both commodities.

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

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

Natural Gas

2.52 Price
-0.450% 1D Chg, %
Long position overnight fee 0.0980%
Short position overnight fee -0.1199%
Overnight fee time 22:00 (UTC)
Spread 0.0050

Silver

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
six month energy commodity prices Six month spot price for energy commodities, as of 22 Dec 2021 – Credit: Koyfin

Performance

Brent Crude Oil

  • Day range: $73.70 - $74.59
  • 52 week range: $49.13 - $86.70
  • 52 week price change: 47.94%
  • 10-day Exponential Moving Average (EMA): $73.32
  • 14-day Relative Strength Index (RSI): 38.13

US Crude Oil

  • Day range: $70.96 - $71.77
  • 52 week range: $46.16 - £83.83
  • 52 week price change: 51.25%
  • 10-day Exponential Moving Average (EMA): $70.34
  • 14-day Relative Strength Index (RSI): 40.03

US Natural Gas

  • Day range: $3.81 - $3.91
  • 52 week range: $2.26 - $6.47
  • 52 week price change: 38.96
  • 10-day Exponential Moving Average (EMA): $3.85
  • 14-day Relative Strength Index (RSI): 37.51

Markets in this article

Oil - Brent
Brent Oil
75.983 USD
1.511 +2.030%
Oil - Crude
Crude Oil
71.410 USD
1.62 +2.320%
Natural Gas
Natural Gas
2.5235 USD
-0.0115 -0.450%

Related topics

Rate this article

The difference between trading assets and CFDs
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.
Capital Com is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as an investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risk.

Still looking for a broker you can trust?

Join the 570.000+ traders worldwide that chose to trade with Capital.com

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading