|Analysis||Oil prices inclined yesterday as the dollar fell therefore supported oil prices since commodities are priced in dollars which meant that it became cheaper for investors. As investors entered oil markets boosted oil prices while also the U.S. economy released its EIA report showing that crude inventories fell while it was estimated to incline, therefore this meant that there is demand somewhat. The contract gained $0.44 closing at $79.58 while recording a high of $80.33 per barrel and a low of $78.67 per barrel. |
The EIA report was released yesterday showing that the U.S. commercial crude oil inventories decreased by 0.9 million barrels from the previous week. At 336.8 million barrels, U.S. crude oil inventories are slightly above the upper limit of the average range for this time of year. Total motor gasoline inventories decreased by 1.7 million barrels last week, and are above the upper limit of the average range. Finished gasoline inventories increased while blending components decreased last week. Distillate fuel inventories decreased by 0.3 million barrels, and are above the upper boundary of the average range for this time of year.
The U.S. stocks declined as technology companies fell in trading after estimated earnings at Salesforce.com Inc. and Autodesk Inc. was worse that market expectations. Turning to oil shares, we see that Exxon Mobil rose 0.24 points or 0.32% to $75.27, Chevron Corp. climbed 0.11 points or 0.14% to $78.92 while ConocoPhillips dipped 0.11 points or 0.20% to $53.58.
Today, oil prices are losing their strength as there are worries about the strength of the global economic recovery; therefore confusion back in markets which weighed on oil prices as investors walked out of oil markets. The markets today opened at $79.63 while recording a high of $79.87 and a low of $79.00 per barrel.
The volatility in the markets remain as investors are confused about the exact trend oil prices are taking which therefore is a result of the mixed data from major economies, while once again dear reader, we believe that oil prices in the long run are weakened from the global outlook.