jump to navigation

Crude Oil Trading Nearly Flat September 8, 2010

Posted by mytruthaboutoil in Oil prices, Oil trading.
trackback

A piece of news from the Wall Street Journal which might set the trend… Wait and see…

Crude futures were mostly flat Wednesday as scant signs of improvement in the broader economy have investors looking ahead to data on U.S. oil inventories later this week.

Light, sweet crude for October delivery was trading 21 cents lower at $73.88 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange traded 35 cents lower at $77.39 a barrel.

Oil prices have fallen for the past two sessions, slumping as concerns grow about a glut of oil in the U.S. and a sluggish economic recovery that shows no signs of reducing the high supplies.

Economic data last week provided some modest optimism as a report on U.S. manufacturing showed continued growth and the monthly jobs report was better than anticipated. But new worries about the strength of Europe’s financial system have cropped up this week, and stagnant equities have left crude treading water as well.

“The market is building up energy to make an assault on either side of the range,” said Gene McGillian, a broker and analyst with Tradition Energy. “The signals from the economy are going to give us a better idea of what side it’s going to come down on…but until we see signs these record inventories we have are pared back, I’m more inclined to think we have more of a chance of testing the downside.”

Commercial stocks of oil and fuel products remain at 27-year highs, and data due Thursday from the Department of Energy is expected to show a further build.

The department’s Energy Information Administration is expected to report crude inventories rose by 300,000 barrels in the week ended Sept. 3, according to a survey by Dow Jones Newswires. Gasoline stocks are expected to show a modest 600,000-barrel drop, while distillates, which include heating oil and diesel fuel, are seen rising by 400,000 barrels.

High supplies and an uncertain economic outlook have kept crude prices from pushing above the recent trading range between roughly $70 and $80 a barrel. But traders are wary of moving much lower either, particularly amid an Atlantic hurricane season that could quickly reduce stockpiles should a storm affect Gulf of Mexico oil producers.

“This remains a very difficult trading environment in which price follow through in either direction of more than $3 to $4 within any given week has proven elusive,” Jim Ritterbusch, head of oil research firm Ritterbusch and Associates, said in a client note.

Front-month October reformulated gasoline blendstock, or RBOB, recently traded 1.06 cents, or 0.6%, lower at $1.9223 a gallon. October heating oil recently traded 0.69 cents lower at $2.0674 a gallon.

Advertisements

Comments»

No comments yet — be the first.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: