Yesterday, crude oil prices gained after the US released its manufacturing data saying that it contracted less than it was expected. As the news came out it showed that the economy is still slowing down but on a slower pace and this eased concerns regarding the economy.
Also a support to the rise in oil prices is that an OPEC official said that they will not pump any more crude in the market as they believe that there is no use for it while consumer fear the current oil supplies. The contract on Monday gained $0.41 as it closed at $127.76 while recording a high of $129.35 per barrel and $125.22 per barrel.
Today prices start to dip as investors believe that prices have reached their peak as they lock in on profits and leave the markets. Other investors believe that there are still tight supplies and growing global demand despite the fact that the biggest crude consumer, the U.S is in a slowdown as they stay in markets looking for potential in profits. The markets opened at $127.50 while recording a high of $127.71 per barrel and a low of $127.19 per barrel.
Once again supply and demand factors continue to overcome the market causing prices to remain volatile. It has been noted that speculative trading was the reason behind the surging of oil prices witnessed lately and not due to insufficient supplies. Now investors are unsure about the markets as the Atlantic hurricane season is around the corner as they fear possible disruptions.