NewsCrude contracts hold above $82 in early trading
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AnalysisCrude future contracts are stable above $82 per barrel in the Asian session, after it recorded its highest levels yesterday in a year around $83.50 per barrel; therefore, investors indulged in profit-taking after contracts continued rising throughout the previous week, despite continued weak demand levels on crude.

Crude oil contracts rose from $69 per barrel in mid December to record $83.50 per barrel yesterday, the highest since November 2008 supported by signs of the beginning of improvement in economic conditions in the U.S and the global economy strengthened in the previous weeks; despite that demand levels on oil still remain weak, according to the EIA report.

The weekly EIA reported a rise in crude stockpiles yesterday by 1.3 million barrels, after a drop of 1.5 million barrels last week; opposing by that expectations for a 0.4 million barrels drop. Oil stockpiles reached 327.3 million barrels, above their average range for this time of the year. Meanwhile, motor gasoline stockpiles rose by 3.7 million barrels and remains above the medium term average, on the other hand, distillate fuel stockpiles that include heating fuel dropped by 0.3 million per barrel.

The drop in distillate fuel stockpiles in the US, considered to be the number one energy consumer in the world, is due to the cold weather dominating vast regions in the US last week, with constant expectations for the cold weather to prevail supporting further demand on heating fuel.

The S&P GSCI index closed yesterday at 547.87 higher by 9.39 points; whereas S&P GSCI energy index closed at 278.03 after rising by 4.90 points.

Meanwhile, heating oil future for February delivery ended in NYMEX at $2.19 per gallon down by 1.06 cents, whereas motor gasoline declined by 0.60 cents to $2.13 per gallon. Natural gas contracts ascended by 6.8 cents to close at $6.08 for every 1000 cubic feet, while in London Brent contracts for February delivery fell 30 cents to end at $81.59.

So dear reader, most global economic data support expectations of crude prices settling around $80 per barrel throughout this year, yet the constant fear of weakness prevailing in demand levels on oil could possibly impede the process of achieving the expected recovery.

Crude contracts for February delivery opened today at $83.15 per barrel, recording its highest at $83.32 and lowest at $82.50 per barrel, where current contracts are trading around $82.72 per barrel.