Crude oil will see the bulls in action on signs that the US economy is recovering. Asian trade saw Brent oil August contracts rising to $103.09, while West Texas Intermediate crude contracts for the same month were up at $97.27 a barrel. Crude oil futures closed higher for the fourth session in a row, after a set of encouraging economic reports that showed US jobless claims declined last week while consumer spending increased last month.
The euro-zone’s economic confidence has improved along with industrial confidence while consumer confidence and service confidence declined. This supported gains in the European equities and the euro. The euro settled at 1.3038 against the dollar, up 0.20% The US’ personal income has increased along with spending while the jobless claims remained higher. The dollar index fell 0.09% against the major currencies and settled at 82.902 but climbed in overnight trading above the 83 price level and is holding at 83.11 this morning. Gold tumbled below the 1200 price level as traders sentiment shifted with low inflation and a global economic recovery underway. This shift in sentiment is supporting crude prices as there has been little in the way of fundamentals to support price increases.
Crude oil steadied above $95 a barrel yesterday, clinging to most of the gains from the previous session after weaker than estimated U.S. economic growth allayed worries the Federal Reserve will curb stimulus soon.
Crude oil production in Texas has jumped by a third in just 12 months, government figures showed on Thursday, with booming output driven by the Eagle Ford shale fields and Permian Basin now outpacing growth in North Dakota. South Sudan expects a first oil shipment of 1 million barrels to sail from Sudan’s Port Sudan terminal on Saturday, despite a threat from Khartoum to halt cross-border flows, its oil minister said on Thursday.
Global oil production continues to climb, while growth estimates around the globe decline. China yesterday revised their estimates for 2013 to 7.5% down from 7.7% last month and off the 7.9% estimate just a few months back. The U.S. Energy Information Administration on Wednesday reported that U.S. crude-oil supplies held steady for the week ended June 21 at 394.1 million barrels. Analysts polled by Platts were looking for a 2 million-barrel decline. Gasoline supplies rose by 3.7 million barrels, while distillate stockpiles increased by 1.6 million barrels, the EIA said. Gasoline stockpiles were expected to gain by 1 million barrels, and forecasts also called for a rise of 1 million barrels for distillates.
Traders should expect a decline in oil prices when traders take a good hard look at the fundamental.