OANDA - Oil futures commentary

Please attribute the following commentary to Jeffrey Halley, senior market analyst at OANDA. For direct comment, call Jeffrey at +65 9457 1849 or email jhalley@oanda.com.

After pausing for breath in Asia yesterday, oil resumed its march higher in London and New York trading, with both Brent and WTI futures hitting new trading records volume wise.

Spot WTI traded above $51 a barrel before easing slightly into the New York close. Spot Brent rose to above $53 a barrel before easing slightly to $52.40. Trading was concentrated in the February and March futures contracts, which rose 5%.

Crude seems to be trying to move to a new trading range each side of $55 a barrel. Brent in particular, is attracting interest over WTI with the spread between the two widening. This is probably a reflection of the fact that US shale drillers will be furiously dusting of dormant rigs, as prices move higher, and hedging via selling WTI futures into the rally.