Plus500 does not provide its products and services to residents of United States.

Plus500 does not provide its products and services to residents of United States.

72% of retail CFD accounts lose money.

Menu

Oil Prices Turn Brisk as Chills Boost Demand

Plus500 | Tuesday 16 February 2021

Oil (CL) prices sparked above $60 a barrel on Monday, for the first time since the early days of 2020 as regions across the U.S. have recently been hit by freezing weather. Arctic conditions boosted demand for electricity and fuel, while threatening Gas and Oil production in Texas.

oil

The arctic weather caused major refineries to shut down on Monday due to electricity, fuel and water cuts across Texas. Over three million barrels of daily Oil processing has been delayed because of storms. 

These shutdowns threaten supply restrictions on other various commodities such as gasoline, propane and various Oils, which may continue for weeks. This demand for supply impacts cities across America which especially rely on the U.S. Gulf Coast for gasoline. Production setbacks will likely go beyond Texas if the cuts turn from days into weeks, taking into account that the Oil sector has already reduced production during the COVID-19 outbreak.

Arctic Conditions Rally Oil and Gas Prices

Some Oils felt the cold and rose yesterday, hitting above $60 a barrel. These included Oil (CL) 0.7% with a high of 60.96, Brent Oil (EB) reached a 13 month high of 63.78 a barrel and WTI crude futures climbed just over $60.00.

As Oil production was idled by the cold, Natural Gas (NG) welcomed the storm, following Oil’s price upward trend and jumped 3.8% at the end of the trading day yesterday.

As traders keep their mittens on and watch for further developments in Texas, it is still unknown how these commodities will react in the coming days and if the storm will continue to affect supply for days or weeks.


Get more from Plus500

Expand Your Knowledge

Videos & Articles help you expand your trading knowledge.

Prepare Your Trades

Our Economic calendar helps you explore global market events.

Trade Without Surprises

Understand the full costs of your trades now for better expense management later.


This information is written by Plus500 Ltd. The information is provided for general purposes only, and does not take into account any personal circumstances or objectives. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice. No representation or warranty is given as to the accuracy or completeness of this information. It does not constitute financial, investment or other advice on which you can rely. Any references to past performance, historical returns, future projections, and statistical forecasts are no guarantee of future returns or future performance. Plus500 will not be held responsible for any use that may be made of this information and for any consequences that may result from such use. Hence, any person acting based on this information does so at their own discretion. The information has not been prepared in accordance with legal requirements designed to promote the independence of investment research.

Cryptocurrency CFDs are not available to Retail Clients.

Need Help?
24/7 Support