NewsCrude is getting better since the opening of the session
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AnalysisCrude oil declined heavily yesterday after it lost its upside momentum when uncertainty becomes so high amid political unrest in Europe is rising and it took too long, on the other hand a wide selloff wave were seen yesterday after the borrowing costs on Italy have reached a critical levels.

Crude opened today’s session at $95.65 and reached so far a high of $96.91 after it reached a low of $95.18, where it is currently trading around $96.50.

But today, crude is trying to show some positive signs on news that the Greek political conflict has eased after the PM Papandreou relieved markets and said that he will resign indeed when a proper candidate for the coalition government will be chosen, which is aiming to approve on the new bailout package.

Contagion fears are appeared significantly yesterday after the Italian bonds yields reached a high and critical level above 7%, which is the level that urged Portugal, Ireland and Greece to ask for bailouts, and Italy is much bigger than those economies which will hurt the whole continent significantly.

High uncertainty from Europe have affected global markets yesterday, and especially the common currency Euro, declined sharply on very bad outlook for the Euro area amid domino effect is taking place as investors saw yesterday when Italian bonds yields surged above the critical levels.

The only thing that kept crude oil above yesterday lows, is the EIA report which reported a drop in U.S. oil inventories by 1.4 million barrels unlike expectations that referred to a rise by half million barrels, and this report we can say that is the only thing that gave crude positive momentum to struggle amid high uncertainty that pushed it lower.

Amid lack of fundamentals yesterday, crude was so volatile following any good or bad news from Europe in particular which is dominating investors’ concentration, as its future is remain unclear amid high political conflict in Greece and Italy.

Nonetheless, today the picture is getting more clarity than before, as it is time that a new Greek prime minister will be announced as opposition calling, and the Italian parliament will hold a vote meeting tomorrow on austerity plan which will be followed by Berlusconi’s resignation.

Volatility will be evident in today’s trading ahead of the BoE rate decision which is high watched by investors waiting for any moves from the bank as it raised the APF last decision to reach 275 Bn pounds but today it is not expected to change his monetary stance especially after the growth figures became better in the third quarter than the previous one.