By Prince Okafor

Amidst fear of oversupply concerns to complicate commodity rebound, crude oil price, yesterday, witnessed a surge to $56 per barrel, after witnessing series of declines.

Oil money

Vanguard gathered that, Brent for March settlement rose $1.88 to $55.68 a barrel on the London-based ICE Futures Europe exchange, while, West Texas Intermediate for February gained $1.76 to $47.17 a barrel on the New York Mercantile Exchange.

According to Organisation of Petroleum Exporting Countries, OPEC, “the price of OPEC basket of 15 crudes stood at $51.55 a barrel on Friday, compared with $52.35 the previous day.

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An Analyst at FXTM, Lukman Otunuga, told Vanguard in a chat: “Concerns over plateauing global economic growth, US-China trade tensions and rising production from US Shale are poised to weigh heavily on oil prices in 2019.

“Oversupply concerns will complicate any efforts for the commodity to rebound higher. The OPEC production cut deal is seen facing headwinds if demand for crude ends up weakening on slowing global growth.

“With OPEC and Non-OPEC members potentially pumping production on signs of repeated weakness in oil markets, the outlook for oil remains tilted to the downside. For oil prices to recover, the global landscape needs to improve, trade tensions must ease and US Shale to reduce production.”

Also, Gene McGillian, a market research manager at Tradition Energy in Stamford, said: “We’ve seen a couple of times where the market attempted to pick itself up and it seems the selling pressure always returns.”

“Until we see more evidence that fundamentals in the market are not as weak as some think, I think we’re going to keep feeling that pressure.”