NewsCrude drop below $76 ahead of more earnings this weekPreviousForecastAnalysisCrude this morning is hovering below $76 per barrel due to the sharp drop in futures witnessed last Friday, consequent to lower US confidence and worse than expected corporate earnings. Meanwhile, we await more earnings this week, while traders maintain their gaze on declining global stock markets.
Crude today opened around $75.55 per barrel recording its highest around $75.95 and lowest around $75.42, while it currently is trading around $75.75 per barrel.
The drop crude witnessed last week hovering around $70 gave impetus to investors that the economic recovery seems to be stalling after downbeat data and less than expected earnings, offsetting the news of lower inventories and the start of the positive earnings season.
Meanwhile, US stocks last week managed to close at their lowest levels in two weeks; Bank of America, Citigroup and General Electric all reported worse than expected results, where Asian markets were affected in result of bad US data as Asian stocks fell notably.
Crude on Friday traded around $76.80 per barrel recording its highest around $77.10 and lowest around $75.25 per barrel, closing around $75.85 per barrel. It managed to record a drop of $0.61 due to weaker US data, with a wave of pessimistic sentiment that enveloped the market last week.
On the other hand, this week we expect more US earnings to be released, such as International Business Machines Corp. today, Goldman Sachs group Inc. tomorrow; while Coca-Cola Co., Amazon.com Inc. and Microsoft Corp are expected later on in the week.
In addition, crude is trading within the first half of this year around $75 per barrel after signs of stability and recovery started to emerge following the worst financial crisis since the Great Depression, specifically since developing countries such as China and India have shown positive signs and thereby supporting economic growth across the world.
However, the European debt crisis still maintains its tight grip on the outlook for global recovery alongside elevated oil inventories which is preventing crude from extending the gains.
As for NYMEX as of 03:15 EST; motor gasoline fell to $204.800 per gallon by $0.060; heating is trading around $201.200 per gallon dropping by $0.070; whereas natural gasoline gained $0.023 per 1000 cubic feet by $4.542. In London, Brent futures plummeted by $0.130 to record $75.240.