|News||Crude fluctuates since the opening of the session|
|Analysis||Crude oil fluctuates since the opening of today’s trading after it declined yesterday due to rising fears over the European crisis, as the Slovakian parliament has rejected the extension of the EFSF, and the U.S. Senate refused Obama’s $447 billion jobs creation plan.|
Pessimistic data were released lately yesterday from Europe and U.S, as the Slovakian parliament rejected the measures of expanding the EFSF and the Prime Minister urged the parliament to pass these measures to support the Euro area, which increased fears over the Euro area crisis and how leaders will contain the crisis, especially after Trichet said that the Euro Zone crisis became significant and they will have systematic risks that cannot be avoided.
Crude oil futures for November settlement are volatile since the opening of the session at $85.28 recording the high of $85.82 and the low of $84.52 a barrel, where it is currently trading at $85.40.
On the other hand, the President of European Commission Jose Manuel Barroso will address the European Parliament today and it is expected to provide more details on plans to recapitalize the European banks in order to avoid a credit crunch.
Fears and concerns returned to markets after the Slovak parliament rejected the EFSF expanded powers, also, the U.S. Senate refused to pass Obama’s jobs plan, which increased doubts over the economy since it facing strong difficulties in the last period, as unemployment rate reached 9.1% so far.
Also, the U.S. Senate approved a measure of punishing China for its undervalued currency in order to support the U.S. economy and create more jobs, as the undervalued currency is giving more privileges to the Chinese products making them so cheap, which threats the U.S. products and make them less demanded from consumers.
Data from the world’s largest economy are weighing negatively on the market, amid the deepening debt crisis in Europe and sluggish growth worldwide, which affects demand on crude oil for now and for the future.
Today, investors will keep their eyes on the FOMC minutes for last meeting in September, which released their $400 billion stimulus plan to support growth and the economy, due to its slowing recovery.
It is expected that crude would decline in today’s trading taking the effect of all these pessimistic data, that reflects a possible recession for the global economy, and since crude is a very sensitive growth commodity, it will be affected significantly and decline.