|News||The EIA Report|
|Previous||-2.8 Million Barrels|
|Forecast||-1.9 Million Barrels|
|Analysis||Crude continues its drop for the second consecutive day in a row below $80 per barrel, at the same time renewed fears are arising regarding the recovery pace the global economy is moving within. This is due to the dollar’s rise against a basket of foreign currencies, while we await for the release of the EIA report later on today that is expected to reflect a drop in demand.|
Crude today traded below $80 per barrel recording its highest around $80.42 and lowest around $79.42, while currently trading around $79.50 per barrel.
The American Petroleum Institute yesterday showed that crude inventories last week dropped by 2.2 MB, lower than the previous 2.4 MB; gasoline inventories also fell and distillates rose.
The FOMC meeting held by the Feds confirmed the weak pace of recovery the US economy is facing, which calls for an expansion for the quantitative easing policy; thereby reflecting negatively on markets regarding how far along the economy is recovering in the second largest energy consumer in the world. They said that they will be using investments and mortgage money to purchase government debt at a smaller amount, which therefore could help long-term mortgage and corporate rates debts to drop.
Crude yesterday traded below $81 per barrel recording its highest around $81.57 and lowest around $80.30 per barrel, closing around $80.20 per barrel; it lost $1.23 or 1.51%.
Moreover, traders are anxiously awaiting for the release of the EIA report later on today, where expectations point out that crude inventories will drop since the previous week inventories witnessed a 1.9 MB drop.
As for NYMEX as of 03:29 EST; motor gasoline declined to $2.0725 per gallon to record $0.0128; heating is trading around $2.1081 per gallon losing $0.0173; whereas natural gasoline rose by $0.005 per 1000 cubic feet to record $4.302. In London, Brent futures dropped $0.67 to record $78.930.