Yesterday crude oil prices rebounded as a result of tensions in Nigeria. Nigerian oil facilities are being threatened by militants as this adds to the current insufficient supply woes while supply was already cut back by 130,000 over the weekend due to attacks. As prices rose again, it added more to countries inflationary pressures.
Investors once again start focusing on supply and demand factors as they put aside the fact that the US has dampening gasoline demand and enter the crude oil markets. With the investment inflow in the crude market, the contract gained $2.18 as it closed at $131.03 while recording a high of $131.58 per barrel and a low of $125.96 per barrel.
As consumers cut back on driving due to surging gasoline prices, crude prices today continued to dip as US inventories of crude and petroleum is projected to have increased. Also as we know that there is a global slow down, investors fear that demand on oil will be crippled as they start leaving the market. Due to the spiking of black gold prices, US gasoline demand slipped 5.5% while Asia is also expected to lower its fuel purchases.
The EIA petroleum report is scheduled to come out today as it was moved over from yesterday due to the Memorial Day Holiday on Monday. Expectations are that US crude supplies grew by 750,000 barrels as for gasoline stockpile to have increased by 400,000 barrels. While distillates which include diesel fuel and heating oil are also projected to have inclined by 800,000 barrels.