Oil is on the rise amid some Commodity Trading Advisor (CTA) buying and spreads showing signs of recovery, analysts at TD Securities note in a research note.

Markets see uptrends reforming after OPEC+ meeting

“The energy complex is recovering nicely as CTA buying begins to take hold with uptrends reforming post-OPEC+ announcement. Spreads have also shown major signs of recovery, with Dec-Dec spreads jumping over 40% off the lows seen in the aftermath of the OPEC+ decision.”

“In this sense, CTAs are back on the bid in WTI and Brent crude, with the next upside triggers at prices north of $79.87/bbl and $83.16/bbl respectively.”

“With that said, the backwardation remains much reduced vs the levels seen in March-April, suggesting there is still more relative concern about Q4 balances and beyond, which should serve as a resistance to major upside.”