WTI crude oil and Brent Sea crude oil continue to bounce around remaining near recent lows. WTI is trading at 82.46 down by 4 cents and Brent is at 86.22
WTI crude oil and Brent Sea crude oil continue to bounce around remaining near recent lows. WTI is trading at 82.46 down by 4 cents and Brent is at 86.22 down by 3 points with the spread closing to just over $3.50. Lower oil prices continue to send gasoline prices to their lowest in years. Gasoline is trading at 2.2052 down 5 points this morning. Average retail gasoline prices in US Midwest fell 7.2 cents per gallon in the past week, averaging $3.20 a gallon Sunday, according to GasBuddy’s daily survey of 127 gas outlets. Prices are 14.5 cents per gallon lower than the same day one year ago and 22.4 cents per gallon lower than a month ago. The national average has fallen 6.1 cents per gallon in the last week to $3.12 a gallon. It has decreased 22.9 cents per gallon during the last month and stands 23.1 cents per gallon lower than this day one year ago.
Brent crude oil ended up almost 1% on Tuesday, helped by data showing stronger-than-expected China demand and some technical price recovery after weeks of almost uninterrupted selling.
Market sentiments were muddled earlier today following key economic releases from China. Amidst lingering worries over global economic growth, 3Q GDP data from China, which was better than anticipated, had provided some relief to the market. However, the world’s second largest economy grew at the slowest pace since the first quarter of 2009.
There are some major players manipulating the energy markets at present for their long term strategic effects. There has been a lot of speculation about what Saudi Arabia has been doing. In fact, their strategy is still faulty – they want lower oil prices to pressure Russia vis-à-vis Syria, change their stance vis-à-vis Damascus and they want to more or less price shale gas from the US out of the market, and also pressure Iran vis-à-vis what’s going on in the Middle East, the famous Saudi-Iranian antagonism.
Last week Saudi Arabia lowered their price of oil to Asia, which sparked a oil war as Iran and Iraq followed suit. There are more or less 20 nations that need oil at least for 50 percent of their budget. Among these nations we’ll find especially a mix of African countries and Persian Gulf countries, that includes Saudi Arabia and Iraq as well, Venezuela and Ecuador.
Slumping oil prices are putting pressure on U.S. producers. The number of active rigs drilling for oil and gas fell by their most in two months, according to the latest data from oil services firm Baker Hughes. Much of the shale basins that are principally responsible for US oil production will not feel the effects of low prices as quickly as many are predicting.