This article was first published by Seeking Alpha on
April 8, 2015.
By Sarfaraz A. Khan
On the first day of the second quarter, the benchmark WTI
prices posted the biggest gain in more than two months as traders weighed the
possibility of peaking U.S. production, thanks to some positive indicators. The
rally continued in the subsequent days as prices rose above $53 a barrel on
Tuesday, but dropped to $52 a barrel in the early hours of Wednesday. All the
while, the market has been trying to figure out how the biggest geopolitical
wild card, the negotiations between Iran and the P5+1, which includes Germany
and five permanent members of the U.N. Security Council, will impact the
commodity's prices.
The increase in prices in the beginning of this month
came on the back of the first drop in U.S. oil production growth since January
as output dropped by 0.4% from the previous week and better-than-expected oil
demand from a number of major consumers. The recently released strong U.S. jobs
data that showed a surge in U.S. job openings to their highest levels in 14 years
and the latest EIA monthly report in which the agency raised its forecast for
oil demand while lowering expectations of U.S. oil production growth also
supported the bullish sentiments.
