In the week since our last edition of What’s Affecting Oil Prices, Brent rose $0.67/bbl last week to average $67.71/bbl. WTI saw much stronger gains, increasing $1.58/bbl to average $59.39/bbl. Managed money net long positioning for WTI also increased substantially in the CFTC’s latest report. For the week ahead, we expect both crudes to increase at more similar paces and Brent will likely average around $68/bbl.
Sanctions against Iran and Venezuela, as well as OPEC’s commitment to production cuts, have helped support prices. At the latest JMMC meeting, the members of the agreement announced that another meeting was not necessary in advance of the April OPEC meeting. Instead, a meeting should be scheduled in advance of the June meeting, when a decision about the fate of the production agreement will be made.