|News||Crude trades below $80 awaiting the FOMC|
|Analysis||Crude dropped throughout the Asian session today below $80 per barrel, awaiting the fed's FOMC decision today as well as OPEC’s meeting scheduled for tomorrow in Vienna.|
The spotlight today is set on the fed's decision, it is taken for granted that they are to keep rates are their historic low of 0.25%, after the unexpected decision to raise the discount rate last month. The move on the discount window was a signal of gradual normalization in the financial market and the U.S. economy that continued to provide further proof of development in the past few months.
Meanwhile, OPEC's scheduled meeting tomorrow in Vienna is expected to produce steady production targets at previous levels for the fourth consecutive meeting, where it will support global economies that are trying hard to recover from the worst crisis since the great depression.
Crude has been trading in the past eight months between $70 – 80 per barrels, as demand levels on crude started to improve; the enhancement is evident if compared to the glut in inventories that managed to build up in the past year following the deep recession. Improvement is noted yet remains below targets, specifically for advanced countries.
The S&P GSCI index closed yesterday at 515.85 dropping 0.56 points; whereas the RJ/CRB commodity index also recorded a decline by 2.52 to close at 270.79.
In NYMEX as of 04:55 EST; heating oil future fell to record $205.350 per gallon by $0.410; motor gasoline is trading around $222.480 per gallon after rising by $0.200; whereas natural gas descended by $0.003 to record $4.388 per 1000 cubic feet. In London, Brent dropped by $0.370 to record $77.52.
Crude opened today at $79.85 per barrel, recording its highest at $79.90 and lowest at $79.85 per barrel, while currently trading around $79.50 per barrel.