Notice of Index Modifications: Ferrari ETPs

Аватар на автора

Author

Violeta Todorova

Date

Oil Surges in Anticipation of Rising Summer Demand

Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.

  • U.S. crude prices spike as summer demand rises
  • U.S. oil production is flattening
  • OPEC+ extended output cuts of 3.66 million bpd until 2025
  • Geopolitical tensions in the Middle East are once again affecting crude prices.
  • Hurricane season also poses a risk to Gulf Coast oil infrastructure.

Anticipated Surge in Summer Demand Drives Crude Prices Higher

Crude oil prices gained approximately 16% over the past month driven by optimistic expectations of rising demand during the Northern Hemisphere’s summer driving season. Additionally, concerns about escalating conflicts in the Middle East potentially disrupting global oil supplies have contributed to the price increase.

U.S. Crude Oil Production Stagnates

According to the latest data from the U.S. Energy Information Administration (EIA), nationwide crude and condensate production reached nearly 13.2 million barrels per day (b/d) in March 2024. Despite this significant output, there has been no net growth since October 2023, indicating that the surge in production following the end of the coronavirus pandemic and Russia’s invasion of Ukraine has plateaued.

Price Stability and Production Outlook

West Texas Intermediate (WTI) crude prices averaged $73-83 per barrel since February 2024 and do not provide a strong encouragement to either boost or cut production. If prices in the medium-term remain steady, U.S. output is likely to remain flat for the remainder of 2024 and at least through the first half of 2025.

Range bound prices and flat growth in U.S. production have allowed OPEC+ to increase some of their production later in 2024.

OPEC+ Extends Production Cuts Until 2025, influencing Global Supply

In early June, OPEC+ announced the extension of its 3.66 million barrels per day (bpd) production cuts through the end of 2025. Additionally, another 2.2 million bpd cut will extend until the end of September 2024. Combined, these cuts represent approximately 6% of global oil demand and are expected to create supply deficits in the third quarter as higher summer demand would deplete stockpiles.

The prolonged production cuts by OPEC+ are anticipated to exert upward pressure on crude oil prices, particularly as supply tightens and seasonal demand peaks.

Renewed Middle East Tensions Support Crude Prices

Increasing geopolitical risks, particularly involving Israel and Hezbollah, continue to bolster oil prices. Escalating tensions have heightened fears of a broader conflict that could involve Iran more directly. Iran, responsible for about 3 million barrels of oil production per day, accounts for roughly 3% of the world’s output. The potential for conflict to disrupt this supply adds a significant risk premium to oil prices.

Impact of Hurricane Season on Crude Oil Prices

The start of the Atlantic hurricane season, marked by Hurricane Beryl, highlights the vulnerability of oil and gas infrastructure to natural disasters. Potential disruptions to production and consumption in the Americas could further tighten global supply and influence prices.

Hurricane Beryl, the first major storm of the season, poses a potential threat to oil and gas production in the Gulf of Mexico. Classified as a Category 4 storm, Beryl is projected to hit the Yucatán Peninsula on Friday and could disrupt U.S. refining and offshore production. The path of the hurricane will determine the extent of its impact on the energy industry.

Mixed Economic Signals from China

China, the world’s second-largest oil consumer and top crude importer, presents a mixed economic picture. While smaller manufacturers have experienced the fastest factory activity growth since 2021 due to overseas orders, broader surveys indicate weak domestic demand and trade frictions. This discrepancy raises questions about the accuracy of official figures and the true state of industrial activity.

A Bullish Outlook in The Short-Term Despite Uncertainties

The combination of expected supply deficits in the third quarter of 2024, rising seasonal demand, and heightened geopolitical tensions in the Middle East, point to a bullish outlook for crude prices in the short-term. Despite global economic challenges and mixed signals from China, crude prices are likely to continue to trade higher in the coming months.

A graph of a stock market

Description automatically generated

Source: TradingView

Technical Analysis

WTI prices have been trading in a wide range between $70.00 and $87.00 throughout 2024. After finding a solid support at $72.50 in early June crude rebounded strongly, breaking decisively above its minor resistance of $80.60. This suggests the decline from the April high is over and that higher price levels are likely to unfold in the coming months.

Given the impulsive nature of the current rally, we are expecting to see a re-test of the $87.00 level. The weekly Relative Strength Index (RSI) indicator has found support at 44% after the latest sell-off, suggesting that momentum conditions are improving, and that oil could subsequently break above its key resistance of $87.00. Such development would have bullish implications for the price of WTI and could extend the rally to $92.00 – $93.00 in the long-term.

Professional traders looking for magnified exposure to crude oil prices may consider Leverage Shares +2x Long WTI Oil or -2x Short WTI Oil ETPs.

Websim is the retail division of Intermonte, the primary intermediary of the Italian stock exchange for institutional investors. Leverage Shares often features in its speculative analysis based on macros/fundamentals. However, the information is published in Italian. To provide better information for our non-Italian investors, we bring to you a quick translation of the analysis they present to Italian retail investors. To ensure rapid delivery, text in the charts will not be translated. The views expressed here are of Websim. Leverage Shares in no way endorses these views. If you are unsure about the suitability of an investment, please seek financial advice. View the original at

Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.

Share this:

Related Products:

Related Products:

Related Articles

Steady economic growth would lead to robust demand and support oil prices.
Steady economic growth would lead to robust demand and support oil prices.
Steady economic growth would lead to robust demand and support oil prices.
Rising demand, tight supplies and geopolitical tensions are driving a rally in oil prices.
Rising demand, tight supplies and geopolitical tensions are driving a rally in oil prices.
Rising demand, tight supplies and geopolitical tensions are driving a rally in oil prices.

Required Information

Upcoming Webinar

Raj Sheth

Umer Suleman

16 July 2024
12.00 pm (GMT+1)

Welcome to Leverage Shares

Terms and Conditions

Notice

If you are not classified as an institutional investor, you will be categorised as a private/retail investor. At this time, we cannot send communications directly to private/retail investors. You are welcome to view the contents of this website.

If you are an ‘Institutional investor’, you affirm either that you are a Per Se Professional Client, or that you wish to be treated as an Eligible Counterparty Client, both as defined under the Markets in Financial Instruments Directive, or an equivalent in a jurisdiction outside the European Economic Area.

Risk Warnings

The value of an investment in ETPs may go down as well as up and past performance is not a reliable indicator of future performance. Trading in ETPs may not be suitable for all types of investor as they carry a high degree of risk. You may lose all of your initial investment. Only speculate with money you can afford to lose. Changes in exchange rates may also cause your investment to go up or down in value. Tax laws may be subject to change. Please ensure that you fully understand the risks involved. If in any doubt, please seek independent financial advice. Investors should refer to the section entitled “Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in the securities offered by the Issuer.

This website is provided for your general information only and does not constitute investment advice or an offer to sell or the solicitation of an offer to buy any investment.

Nothing on this website is advice on the merits of any product or investment, nothing constitutes investment, legal, tax or any other advice nor is it to be relied on in making an investment decision. Prospective investors should obtain independent investment advice and inform themselves as to applicable legal requirements, exchange control regulations and taxes in their jurisdiction.

This website complies with the regulatory requirements of the United Kingdom. There may be laws in your country of nationality or residence or in the country from which you access this website which restrict the extent to which the website may be made available to you.

United States Visitors

The information provided on this site is not directed to any United States person or any person in the United States, any state thereof, or any of its territories or possessions.

Persons accessing this website in the European Economic Area

Access to this site is restricted to Non-U.S. Persons outside the United States within the meaning of Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”). Each person accessing this site, by so doing, acknowledges that: (1) it is not a U.S. person (within the meaning of Regulation S under the Securities Act) and is located outside the U.S. (within the meaning of Regulation S under the Securities Act); and (2) any securities described herein (A) have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction and (B) may not be offered, sold, pledged or otherwise transferred except to persons outside the U.S. in accordance with Regulation S under the Securities Act pursuant to the terms of such securities. None of the funds on this website are registered under the United States Investment Advisers Act of 1940, as amended (the “Advisers Act”).

Exclusion of Liability

Certain documents made available on the website have been prepared and issued by persons other than Leverage Shares Management Company. This includes any Prospectus document. Leverage Shares Management Company is not responsible in any way for the content of any such document. Except in those cases, the information on the website has been given in good faith and every effort has been made to ensure its accuracy. Nevertheless, Leverage Shares Management Company shall not be responsible for loss occasioned as a result of reliance placed on any part of the website and it makes no guarantee as to the accuracy of any information or content on the website. The description of any ETP Security referred to in this website is a general one. The terms and conditions applicable to investors will be set out in the Prospectus, available on the website and should be read prior to making any investment.

Leverage Investment

Leverage Shares exchange-traded products (ETPs) provide leveraged exposure and are only suitable for experienced investors with knowledge of the risks and potential benefits of leveraged investment strategies.

Cookies

Leverage Shares Management Company may collect data about your computer, including, where available, your IP address, operating system and browser type, for system administration and other similar purposes (click here for more information). These are statistical data about users’ browsing actions and patterns, and they do not identify any individual user of the website. This is achieved by the use of cookies. A cookie is a small file of letters and numbers that is put on your computer if you agree to accept it. By clicking ‘I agree’ below, you are consenting to the use of cookies as described here. These cookies allow you to be distinguished from other users of the website, which helps Leverage Shares Company provide you with a better experience when you browse the website and also allows the website to be improved from time to time. Please note that you can adjust your browser settings to delete or block cookies, but you may not be able to access parts of our website without them.

This website is maintained by Leverage Shares Management Company, which is a limited liability company and is incorporated in Ireland with registered offices at 2 Grand Canal Square, Grand Canal Harbour, Dublin 2.

By clicking you agree to the Terms and Conditions displayed.

Terms and Conditions

Notice

If you are not classified as an institutional investor, you will be categorised as a private/retail investor. At this time, we cannot send communications directly to private/retail investors. You are welcome to view the contents of this website.

If you are an ‘Institutional investor’, you affirm either that you are a Per Se Professional Client, or that you wish to be treated as an Eligible Counterparty Client, both as defined under the Markets in Financial Instruments Directive, or an equivalent in a jurisdiction outside the European Economic Area.

Risk Warnings

The value of an investment in ETPs may go down as well as up and past performance is not a reliable indicator of future performance. Trading in ETPs may not be suitable for all types of investor as they carry a high degree of risk. You may lose all of your initial investment. Only speculate with money you can afford to lose. Changes in exchange rates may also cause your investment to go up or down in value. Tax laws may be subject to change. Please ensure that you fully understand the risks involved. If in any doubt, please seek independent financial advice. Investors should refer to the section entitled “Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in the securities offered by the Issuer.

This website is provided for your general information only and does not constitute investment advice or an offer to sell or the solicitation of an offer to buy any investment.

Nothing on this website is advice on the merits of any product or investment, nothing constitutes investment, legal, tax or any other advice nor is it to be relied on in making an investment decision. Prospective investors should obtain independent investment advice and inform themselves as to applicable legal requirements, exchange control regulations and taxes in their jurisdiction.

This website complies with the regulatory requirements of the United Kingdom. There may be laws in your country of nationality or residence or in the country from which you access this website which restrict the extent to which the website may be made available to you.

United States Visitors

The information provided on this site is not directed to any United States person or any person in the United States, any state thereof, or any of its territories or possessions.

Persons accessing this website in the European Economic Area

Access to this site is restricted to Non-U.S. Persons outside the United States within the meaning of Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”). Each person accessing this site, by so doing, acknowledges that: (1) it is not a U.S. person (within the meaning of Regulation S under the Securities Act) and is located outside the U.S. (within the meaning of Regulation S under the Securities Act); and (2) any securities described herein (A) have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction and (B) may not be offered, sold, pledged or otherwise transferred except to persons outside the U.S. in accordance with Regulation S under the Securities Act pursuant to the terms of such securities. None of the funds on this website are registered under the United States Investment Advisers Act of 1940, as amended (the “Advisers Act”).

Exclusion of Liability

Certain documents made available on the website have been prepared and issued by persons other than Leverage Shares Management Company. This includes any Prospectus document. Leverage Shares Management Company is not responsible in any way for the content of any such document. Except in those cases, the information on the website has been given in good faith and every effort has been made to ensure its accuracy. Nevertheless, Leverage Shares Management Company shall not be responsible for loss occasioned as a result of reliance placed on any part of the website and it makes no guarantee as to the accuracy of any information or content on the website. The description of any ETP Security referred to in this website is a general one. The terms and conditions applicable to investors will be set out in the Prospectus, available on the website and should be read prior to making any investment.

Leverage Investment

Leverage Shares exchange-traded products (ETPs) provide leveraged exposure and are only suitable for experienced investors with knowledge of the risks and potential benefits of leveraged investment strategies.

Cookies

Leverage Shares Management Company may collect data about your computer, including, where available, your IP address, operating system and browser type, for system administration and other similar purposes (click here for more information). These are statistical data about users’ browsing actions and patterns, and they do not identify any individual user of the website. This is achieved by the use of cookies. A cookie is a small file of letters and numbers that is put on your computer if you agree to accept it. By clicking ‘I agree’ below, you are consenting to the use of cookies as described here. These cookies allow you to be distinguished from other users of the website, which helps Leverage Shares Company provide you with a better experience when you browse the website and also allows the website to be improved from time to time. Please note that you can adjust your browser settings to delete or block cookies, but you may not be able to access parts of our website without them.

This website is maintained by Leverage Shares Management Company, which is a limited liability company and is incorporated in Ireland with registered offices at 2 Grand Canal Square, Grand Canal Harbour, Dublin 2.

By clicking you agree to the Terms and Conditions displayed.