NewsOil prices lower for the second consecutive day PreviousForecastAnalysisOil prices continued to decline in early trading today after economic data showed the weakness in the U.S industrial sector -the second largest energy consumer in the world- as well as expectations for a rise in oil inventories during the previous week.
Crude oil futures for June settlement opened today at $96.98 a barrel recording the intraday high so far at $97.59 and the low at $96.76 a barrel, and currently trading at $96.89 with a decline of $0.39 or by 0.40% a barrel.
At the end of yesterday’s trading, the contract closed with a decline of $2.28 or by 2.29% ending trading at $97.37 a barrel.
The data yesterday increased fears about consumption levels from the U.S. especially after the unexpected decline in the Empire Manufacturing Index, recording 11.90 from 21.70 in the previous month, whereas expectations were less pessimistic at 19.55.
In the same context, crude oil inventory last week are expected to have risen according to the American Petroleum Institute (API) report, which is due later today. Expectations are for an increase in the crude oil inventory with about a million barrels and also an increase in the motor fuel inventory by 1.3 million barrels.
In general, oil prices are affected recently by the economic data and the movements of the U.S dollar since the beginning of this month. Crude began to rise steadily since the beginning of this year, in the same time, affected by the political turbulence in the Middle East and North Africa; after Tunisia and Egypt revolutions and transition of turbulences to oil-producing regions such as Libya, which is the third largest oil producer Africa, oil prices moved to new highs setting $115 a barrel at the beginning of this month, which is the highest level since October 2008.
However, the attention paid by the markets to economic data, reflected the fact of low levels of demand from major consuming countries like the United States, and high levels of inflation pushed the central bank of China to tighten its monetary policy and that may affect the demand levels by the largest energy consumer in the world.
Today we await housing sector and industrial production figures from the U.S. and may affect the movements in the oil markets as well depending on the sentiment and the dollar’s trend.