1-5-21 RCC Energy Market Update

The bearish sentiment that pushed the energy market into red figures yesterday was all but forgotten today as bulls rallied back to erase those losses and continued to move higher. Early in the session it was announced that OPEC+ group decided to roll over production levels from January to February which many thought another minor increase was possible in February. Gains were amplified with Saudi Arabia announcing voluntary cuts of 1 million barrels per day in production for February and March to offset minor increases for Russia and Kazakhstan. This allowed for crude oil to surge past the resistance of level of $50 which was the first time since Feb. 26, 2020. However, the contract could not hold above that level and ultimately settled with a $2.31 daily increase. Refined products followed suit with significant rallies of their own with distillate adding $0.0569 and gasoline moving $0.0792 higher. It will be interesting to see how the markets continue to digest this news from Saudi Arabia the rest of the week as analysts will also be monitoring the election results in Georgia and US inventory reports.