A gauge of oil-market volatility fell to the lowest level since October, as crude prices struggle to break out of a $10-a-barrel band they've traded so far this year.
US crude futures traded little changed near $74 on Thursday, but have generally been rangebound since the start of January. Volatility in options markets has also been sliding, reflecting the generally lackluster trading this year, despite a barrage of geopolitical and macroeconomic headlines.
On the one hand, crude prices have been supported by heightened geopolitical tensions and longstanding output cuts from the OPEC+ alliance. But that has vied with higher levels of spare production capacity, as well changing expectations for interest rates and a sluggish-looking Chinese economy, to keep prices fairly tightly bound.
"Both oil market sentiment and conviction remain low," RBC analysts including Michael Tran and Helima Croft wrote in a note. "The market still cannot break flat price out of the current range."
In Asia, the outlook in top importer China remains challenging. Consumer prices in January fell at the fastest pace since 2009, as the Asian nation struggles to shake off deflationary pressures. Producer prices, meanwhile, have been stuck in deflation for 16 consecutive months.
Brent for April settlement added 0.5% to $79.60 a barrel at 10:22 a.m. in London.
WTI for March delivery rose 0.4% to $74.12 a barrel.
Source : Bloomberg