June crude oil prices came under added selling pressure overnight but have recouped some of those losses during the early morning hours. The weakness in the market seemed to originate from uncertainty following Greek and French elections over the weekend. It appears that the leadership change in both countries runs counter to recent austerity measures and triggered fresh concerns over the European debt crisis. As a result, risk assets across the globe came under heavy selling pressure and the US dollar rallied to a new three-week high. Some traders suggested that the more than $11.00 price decline from last week's high ($106.43) to the overnight low ($95.34) in June crude oil was overdone in pricing in a slowdown in global oil demand. The fundamental backdrop in the crude oil market turned negative last week, with easing tensions over Iran's nuclear program, increase in OPEC production and continued build in US inventories. The Commitments of Traders Futures and Options report as of May 1st showed non-commercial traders were net long 296,700 contracts, an increase of 16,154. Non-commercial and nonreportable traders combined held a net long position of 321,153 contracts, an increase of 19,310 on the week.
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