Market sentiment has switched to the opinion that prices are not going much lower, despite warnings from Goldman Sachs and other respected observers that there is no fundamental support for higher prices at this time. Last week various pieces of slightly bullish news that are usually are ignored by the markets were enough to move prices higher for the eighth time in the last ten weeks. Crude now is up 67 percent since February, closing on Friday at $43.73 in New York and $45.11 in London.
Archive for April, 2013
“After a three-day rebound in reaction to the selloff the week before last, oil prices fell again on Thursday and Friday on bad economic news from the US, the EU, and possibly China. This time prices fell faster in the US than in London, widening the WTI-Brent spread back to nearly $12 a barrel at the close. With demand weak in the US and EU, and few signs of improvement in the near future, oil prices may push below $90 in New York and $100 in London…”
“Oil prices underwent their biggest weekly drop in six months last week as US employment numbers came in far worse than analysts had expected, US crude inventories increased to a 22-year high, and the EU’s unemployment rate rose to a record. At week’s end Brent crude was down to $104.12, the lowest in eight months, after having traded close to $112 on Tuesday. NY crude closed at $92.70; the 4.7 percent loss for the week was the biggest weekly loss since last September. The Brent-WTI spread continues to narrow and is now below $12 a barrel. So far this year, Brent crude has fallen 6.3 percent while WTI has increased 1 percent…”
“In a short trading week, oil prices rose steadily last week closing at $97.23 in New York and $109.93 in London. NY crude is now only $3 a barrel below the highs seen in mid February, but Brent crude is still $7 below these highs reflecting the tightening of the Brent-WTO spread to the smallest margin since July. Most of the gain last week was attributed to the “settlement” of the financial crisis on Cyprus and the report that the US economy grew by 0.4 percent in the 4th quarter rather than the 0.1 percent than had been expected…”