Fundamental Oil Report (2011-02-24)

By @ibtimes on

NewsThe EIA ReportPrevious0.9 Million BarrelsForecast1.1 Million BarrelsAnalysisCrude surged above $100 per barrel today on fears over Libyan political chaos to affect crude supplies in the biggest oil reserve country in Africa, while oil producing companies continue suspending operations and evacuating staff from the country.

Crude today hovers around $100 per barrel recording its highest around $103.31 and lowest around $98.48, while it currently is trading around $102.02 per barrel.

Traders’ are presently eyeing current developments in Libya, where political protests turned violent and deadly as Libyan Leader Muammar Gaddafi loses his grip on power. Rebels managed to take control over the majority of the eastern part of the country and closing in on the capital Tripoli, while several warplanes were ordered to bomb protestors and air force pilots have parachuted out of the planes, crashing into the eastern Libyan desert disobeying orders. Meanwhile, the death toll is high and rising in the mere thousands.

Crude yesterday traded around $98 per barrel recording its highest around $99.92 and lowest around $95.14 per barrel, closing around $98.96 per barrel. Futures soared yesterday due to fears overwhelming investors in the Middle East, specifically since the Libyan government is cracking down on protestors leading several oil companies like Eni and Repsol, YPF, BP and French oil giant Total to temporarily suspend production; alongside, Germany’s Wintershall has also started evacuating workers and shutting down operations. Libya holds the largest oil reserve in Africa producing over 1.6 million barrels per day, and one of largest oil contributors in the world.

Moreover, the American Petroleum Institute yesterday stated that stockpiles in the US have risen 163 thousand last week as investors anxiously await the EIA report, due to be released later on today; supplies may show an increase of 1.1 million barrels from 345.9 MB yet the effect of rising inventories is still overshadowed by the political unrest in the Middle East. 

Fears are prevalent in the Middle East, where protests ignited by Tunisia last month spread a wave of political unrest through different Arab countries like, Iran, Jordan, Libya, Bahrain, Yemen, Algeria and Egypt. Analysts fear that this political chaos will negatively affect oil and extend into spring.

As for NYMEX as of 03:57 EST; motor gasoline rose $3.81 recording $281.840 per gallon; heating is trading around $299.140 per gallon inclining $2.98; whereas natural gasoline shed $1.28 to record $3.850. In London, Brent futures gained $5.27 to record $117.110.

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