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During the early Asian session oil futures prices are trading close to $93/bbl in international market. Intensified Civil war in Syria and concern of regional war between Iran and Israel are supporting oil prices to remain on higher. Yesterday, more than 50 people were killed after an airstrike hit the northern Syria. Poling by Israeli and Palestine members came to a conclusion that there may be a regional war in order to stop Iran nuclear program. Thus, this kind of Geopolitical issue is likely to play a major role for today oil prices as Syria and Iran both are linked to the strategic oil delivery points.
Nymex crude oil halted earlier declines on Thursday, with some oil dealers saying prices had fallen too far, too fast. Oil prices held unto most gains after U.S. data showed the number of Americans filing new claims for jobless benefits fell last week. Concerns about the economic weakness prompting central bank action, indications that OPEC's top exporter Saudi Arabia is working to lower oil prices, and rising
U.S. crude oil inventories helped fuel this week's price slide. Helping curb U.S. crude prices, data on Thursday showed U.S. manufacturing closed out its weakest quarter in three years this month and U.S. jobless claims held near two-month highs last week, suggesting stalled economic growth.
The National hurricane center reports that there is 60 percent chance of tropical cyclone formation near to Gulf region, which may support oil prices to trade on higher side on concern of supply disturbances.
This morning the People's Bank of China has moved to inject liquidity into its local markets, conducting 101 billion yuan ($A15.3 billion) worth of open market operations in its banking system, Reuters News reports. According to the news agency, the injection is the first in three weeks and adds to the 966 billion yuan already added to the financial system so far this year. The moves have fuelled uncertainty over the extent Beijing is willing to boost the weakening Chinese economy.
China being one of the world's largest consumer of crude oil, might help push up prices as stimulus should spark China's manufacturing sector increasing demand on energy products especially crude oil.
There are no major economic releases for today. On basis of geopolitical concern we may expect oil futures to hold its upside movement for today session.
This morning natural gas prices are trading above $2.80/MMBTU with gain of more than 0.80 percent in Globex electronic platform. Tensions in the Middle East as mentioned above will weigh on all energy products, but the possibility of a hurricane will have a more direct affect on natural gas from the gulf region.
The largest LNG consumer Japan is likely to increase its LNG import by more than 15 percent in 2013, which may support gas futures prices to trade on higher side. With additional stimulus from the Bank of Japan, production and manufacturing should increase and increase demand for gas.
Expectation of rising space cooling demand may keep gas prices high for today’s session. MDA Earth Sat, another leading weather forecaster, said the 6 to 10-day forecast period would see cooler temperatures and characterized the forecast for the 11- to 15-day period as "a bit cooler than expected as well.