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This morning, oil futures prices are trading in a bearish trend in Globex electronic platform below $88.70/bbl with loss of more than 0.40 percent from yesterday’s closing. Oil prices have slipped driven by rising stocks reported by US Energy department on yesterday.
Crude oil stocks piles has been climbed up above 46.49 million barrels in Cushing Oklahoma delivery center. Today, we may expect oil prices to remain under pressure on account of lower fundamental factor of higher stocks level in WTI delivery centre. However, most of the Asian equities are trading on higher side on speculation of monetary easing after lower home sales data reported in worlds’ largest economy US. Thus higher trading equity market may limit the fall initially.
From economic data front, US durable goods orders are likely to increase in a slower pace may create concern of slowdown in economy. Other than this, weekly jobless claims data are due for today which is also expected to increase. Thus, weaker economic releases may pressurize oil futures prices.
Geopolitical tensions around the world and centered on the Middle East seem to have subsided at present. The oil embargo is in full effect since the beginning of the month, with no supply disruption. Tensions between Turkey and Syria have reduced as the President of Syria is now negotiating his departure.
Traders are worried about tomorrows US GDP release, a drop below expectations could weigh heavily on crude oil, but at the same time, increase the push on the US Federal Reserve for monetary stimulus. The Fed is expected to announce several new programs at its August 1, 2012 meeting next week.
Gas futures prices are trading below $3.060/mmbtu with loss of near 0.40 percent in Globex electronic platform. The decline is mostly from speculators taking profits, as we close out the month. Today we may expect gas prices to remain under pressure driven by higher crude oil stocks level during first half of the day. However, as per US Energy department, gas storage is likely to increase by 28BCF in the last week, which is lower than prior week injection; this may add some positive point is gas prices during US session as storage data is due for today.
AccuWeather continues to forecast hot temperatures throughout the US, with June posting record temperatures and July expected to follow in its footsteps and the forecast for August remains the same, pushing up electric usage by close to 30%.