|News||Crude oil is flying in the sky of the market|
|Analysis||Crude oil continued to trade within very high levels amid concerns and fears over global supplies as tensions increased between Iran and the west after the country blocked IAEA’s attempts to explore the nuclear base which countered the effect of negative signs on Euro zone economy yesterday on contracting manufacturing and services.|
Crude oil opened today’s session at $106.06 and fluctuates heavily after it recording a high of $106.29 and a low of $105.71, where it is currently trading around $106.16 a barrel, and we can see the dollar is getting weaker pushing the commodity upside.
Fears over global oil supplies are the main factor behind keeping crude prices so high, as we saw many factors that would affect the commodity negatively and drive it downside, but fears on supplies are mush stronger than other factors.
As we saw yesterday the report from the American petroleum Institute that showed rising crude inventories in the world’s biggest oil consumer and economy, as the institute reported that stockpiles rose by 3.5 million barrels last week, which raised the chances that the EIA today may report more rise in inventories than expected at 1.3 million barrels.
Also, major sectors in Euro zone economy contracted more than expected in February, which raised the fear level and increased the possibilities that the economy may enter a deep recession in the first half of this year.
Dear reader, we know that we talked too much about Iran-West dispute, but actually we cannot neglect any small detail about the situation due to the importance of it, as we saw how crude skyrocketed once IAEA failed in talks with Iran as it raised the possibilities of a military intervention between both sides.
If such a thing happens, we will see a double price for a barrel of oil, and this thing what is keeping crude highly traded despite other negative factors and despite the crisis in Europe which is keeping the uncertainty high and fears are growing on the outlook of the continent.
In general, crude oil will be so volatile today ahead of EIA report which may show a rise in US inventories by 1.3 million barrels comparing to the previous reading showed that stockpiles declined by 0.2 million barrels, where focus should be on any developments on the Iranian situation