Oil prices rally on demand outlook, econ data

Oil prices (CL=F, BZ=F) are trending higher on Monday, buoyed by improving demand outlooks as markets eagerly await the release of Wednesday's CPI report. Yahoo Finance's Ines Ferré dissects the factors influencing oil price movements and discusses developments that could potentially impact future trends, including the Chevron (CVX) and Hess Corporation (HES) deal.

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This post was written by Angel Smith

Video Transcript

Oil edging higher on improving demand from China.

And the market is waiting on CP I data on Wednesday, Yahoo finances Inez for here with the latest nez Yeah, Josh and we did see today wt I up about 1%.

We also saw Brent crude higher.

Now wt I has been trading within a tight range uh since around May 2nd.

So it did settle above $79 per barrel.

Brent crude on our wifi interactive settled above $83 per barrel and we have been seeing oil off of its peak from April and that's basically because of the unwinding of the geopolitical risk in the Middle East.

But nonetheless, a lot of analysts are saying that look Brent crude, it's up 10% year to date around 10% and you are going to see rent ceiling at around $90 per barrel.

They do not think that that Brent is going to go past 90 OPEC plus doesn't want it to go that high because then you will see a recession worldwide.

So OPEC Plus also, by the way, analysts are expecting the oil alliance to extend its production cuts beyond June and in a sticking with the oil space but getting company specific here, there are some new developments in the Chevron hes deal and some big if not opposition.

At least, I don't know, maybe a fly in the ointment here.

Yes, that's right.

This is from a proxy advisor and proxy advisors are hired by big shareholders like a mutual funds, like pension funds to advise them on murder on what they should do, how they should vote in merger deals.

And this one is with respect to the Chevron and he deal so has shareholders are being told by this proxy advisor that they should abstain from, from vote on that acquisition of at the end of May.

Basically with this proxy adviser saying that this entails that the deal entails risk that it may break down and then there will be no compensation in the end for shareholders.

Now I did reach out to Chevron.

Chevron said that they look forward to this has has shareholders voting on this deal.

But look, this all comes down to the the Guyana stake, the Guyana operation of has this is why Chevron wants to buy has and Exxon Mobil has taken the companies to arbitration.

Basically saying that Exxonmobil has a right of first refusal for that block.

Exxon Mobile has about a 45% of stake in that block and says that it has a right of first refusal for that block.

So wait to be seen what happens with this deal.