|Analysis||Black gold market prices yesterday gained yesterday as a result of the U.S. economy releasing its service sector data showing that it expanded for the first time since August 2008. As the service sector expanded this meant that higher future production from service companies which required higher demand on oil and as a result of this investors were attracted to oil markets as they seek potential in profits. The contract gained $0.46 closing at $70.41 while recording a high of $71.00 per barrel and a low of $68.05 per barrel.|
The U.S. stocks yesterday surged after they had declined the most in two stocks as a result of the upbeat data from the economy while Goldman Sachs Group Inc. is supporting big financial institutions and this helped restore confidence in equity markets. Looking at oil shares, we see that Exxon Mobil gained 1.00 points or 1.50% to $67.58, ConocoPhillips inclined 1.06 points or 2.26% to $47.86 while Chevron Corp. rose 1.25 points or 1.83% to $69.39.
Today, oil prices extend their gains as a result of higher stock markets and this filled the markets with optimism that company production in the long run would improve therefore higher demand on energy products therefore boosting prices, as a result of this, the appeal of oil markets increased. The markets today opened at $70.26 while recording a high of $71.15 per barrel and a low of $70.06 per barrel.
Although oil prices are climbing this week, yet once again dear reader, from our point of view we see that prices in the long term are pressured from the ongoing global recession that is weighing heavily on oil demand therefore causing investors to flee markets.