|News||Crude trades above $75 amidst slower US economic growth|
|Analysis||Crude traded above $75 per barrel today due to investors’ jitters regarding the sluggish US economic growth in the second half, while demand on crude remained low.|
Crude today traded above $75 per barrel recording its highest around $76.05 and lowest around $75.12, while currently trading around $75.62 per barrel.
The slowdown witnessed in economic growth on a global scale is dragging down oil prices from the jumps it had been witnessing in the past year, trading above $80 per barrel. Meanwhile, analysts are closely observing US stimulus spending reductions in the second half of the year, which could undercut economic growth; therefore requiring tightened monetary policies to avoid inflation.
Crude yesterday traded above $75 per barrel recording its highest around $75.70 and lowest around $73.82 per barrel, closing around $75.17 per barrel. It managed to lose $0.35, due to pessimism regarding higher supply levels and weakened demand in US crude supplies and a weakened global economical growth.
The EIA report yesterday showed a slight drop in crude inventories by 0.8 MB which was below expectations; therefore, indicating that demand remains weak in the second largest energy consumer in the world. Meanwhile, motor gasoline remained unchanged last week; distillate fuel rose by 1.1 MB above the upper limit of the average range for this time of year.
On the other hand, stocks markets climbed supporting investors' risk appetite; the Dow Jones rose 0.09% or 9.96 points to reach 10415.54; Nikkei also followed to gain 1.3% or 122.14 points to reach 9362.68 points.
As for NYMEX as of 04:00 EST; motor gasoline rose to $196.370 per gallon to record $0.13; heating is trading around $203.260 per gallon gaining $0.38; whereas natural gasoline dropped by $0.09 per 1000 cubic feet to record $4.235. In London, Brent futures added $0.34 to record $76.730.