The major driver behind the current dynamics is the abated fear of a US-China trade war which runs the risk of undermining the global economic growth and, therefore, global oil demand. Due to investors’ relief on this front, Brent has managed to shake off the pressure for the time being. Nevertheless, the current picture doesn’t look sustainable as risky assets may come under pressure again, should any fresh signs of trade escalation emerge.
In addition to this, there is a risk from the US data. Today’s numbers may point to further inventory increase, and if the growth turns out substantial, the report may serve as a catalyst for profit taking at high and attractive levels. In this scenario, the asset will retreat from current highs below the $69 figure, though the potential will likely be limited due to a favorable risk environment globally.